Royal Mail

Postal union leaders are threatening to ballot members on boycotting deliveries for Royal Mail’s rivals, in a move that could muddy the waters over privatisation of the state-owned postal operator.

The Communication Workers Union’s annual conference on Tuesday will discuss a timetable for a consultative ballot of its 150,000 Royal Mail members to introduce a ban on the grounds that rivals are competing unfairly by “cherry-picking” profitable bulk mail contracts.

While Royal Mail is responsible for delivering nearly all the letters delivered, it takes a fee for delivering presorted mail to the final address. Postal workers say the contracts are undermining pay and jobs.

Companies such as BT, Thames Water, Sky, Barclays, NPower, O2 and Talk Talk use rival firms, such as TNT Post and UK Mail, to handle all or some of their mail. Post presorted by Royal Mail’s rivals is now close to 50 per cent of all letters, compared with 5 per cent in 2005.

Royal Mail’s management has been braced for an increase in industrial disputes in the run-up to negotiations with the CWU over a two-year pay and conditions deal that is an important element in the privatisation package.

The CWU fears that the loss of business to its rivals will threaten the universal service obligation – the promise that Royal Mail will pick up and deliver six days a week for a uniform price anywhere in the UK.

Ofcom, the regulator, said: “The one-price-goes-anywhere universal service is enshrined in law, and could only be changed by Parliament. Ofcom has made clear that we have no plans to recommend any such change, and the Government has ruled out any change within the current Parliament.”

The Royal Mail said it was fully committed to the delivery of mail entrusted to it under access contracts. It made an £80m profit on the previously lossmaking activity in 2011-12.

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