The Communication Workers Union (CWU) has issued a furious response to the leaking of an Ofcom report into Royal Mail. Little wonder really, when one of the regulator’s reported proposals is letter deliveries every other day. However, there’s more to this story than meets the eye – because it all hinges on the company’s new bosses, and whether Ofcom is simply ‘reading the (board) room’ over the state of Royal Mail.
Royal Mail: in dire straits
Royal Mail has been in dire straits for years. For example, as the Canary has documented it made a £1bn operating loss in the 52 weeks from March 2022 to 26 March 2023. As we wrote at the time, this level of losses shows:
bosses’ management of the company was a shambles. This won’t come as a surprise to anyone who’s been following the dispute between the CWU and Royal Mail. The company has lurched from self-induced crisis to self-induced crisis.
From its (now former) CEO Simon Thompson lying to a parliamentary committee, to him and his cronies threatening to declare Royal Mail insolvent if the CWU didn’t bow down to their demands, the past 12 months at the company have been a farce.
Moreover, as anyone who still receives letters will tell you, Royal Mail’s service is already dire – thanks to management. However, don’t take customers’ word for it. In November 2023, Ofcom fined Royal Mail £5.6m for missing its first and second class mail delivery targets for the entire financial year of 2022-23.
Postal deliveries every other day?
So, as Sky News reported the regulator is reviewing Royal Mail‘s options after years of chaos. It is supposedly releasing a report on Wednesday 24 January into the Universal Service Obligation (USO). This is part of the deal that Royal Mail has with the government – where, to be allowed to have a monopoly on letter deliveries, it has to operate them six days a week.
Ofcom will reportedly look at a range of options. However, none of these appear to be good for the customer, workers, or the business itself. Sky News says it:
has learnt the regulator will on Wednesday publish a consultation paper on the future of the Universal Service Obligation (USO), which industry sources believe is likely to include reforms such as modifying first and second-class delivery targets; following European markets such as Germany and Italy in moving to alternate-day deliveries; providing a state subsidy to support the USO; and allowing Royal Mail to impose higher stamp prices.
Amending the current six-day USO – which obliges Royal Mail to deliver to every UK address six days a week for the price of a stamp – to a five-day structure that would then lead to the long-standing system of Saturday deliveries being scrapped is also understood to be among the options that will be presented in the Ofcom paper.
However, axeing the USO altogether, as Denmark has done recently, is unlikely to be a realistic option that would gain support from ministers.
Predictably, the CWU has hit back.
Ofcom: a “sham” and in cahoots with bosses and the government?
The union slammed not only the leak of the report, but Ofcom overall. A CWU spokesperson said:
The early leaking of the details of the Ofcom report on the future of the Universal Service Obligation (USO) to the media sums up the lack of professionalism, integrity, and credibility they have as a regulator.
This report, like their previous investigation on quality of service, has been produced without the input of a single postal worker or the CWU.
Ofcom have abandoned their responsibilities on quality of service and are now attempting to do the same on the USO.
Debating the future of the postal service in the absence of those who work for it and deliver it every day is completely inappropriate and should tell everybody what Ofcom’s real priorities and motives are.
It is therefore no surprise to see Ofcom potentially recommending letter deliveries every other day which is a serious down-dialling of the USO to a level which would threaten tens of thousands of jobs.
This is the regulator openly pursuing the failed agenda of the former Royal Mail Group senior leadership – all of whom have now left the company.
CWU general secretary Dave Ward went further on Sky News on Monday 22 January. He told host Kay Burley:
we think the whole of Ofcom’s approach is a complete sham. It’s about getting to a predetermined outcome. And we’re not going to sit back and allow Ofcom, Royal Mail, the government, to destroy what is an important public service which customers still support…
A “huge test” of the new bosses
Further to this, a CWU spokesperson laid out the union’s position:
The CWU and our members are not blind to the need for change. But we want change based on the needs of customers, the security of our members’ jobs and driven by an ambitious growth strategy that sees the infrastructure, fleet and presence in every community as Royal Mail’s key assets.
The CWU will work with economists to produce an alternative and independent view on the future of postal services in the UK and embark on a major engagement exercise with our members, businesses and the public.
This is a huge test of the new leadership of Royal Mail.
There has been some positive recent signs but they must now decide whether to back a completely failed vision which will destroy the company or change direction and join the CWU in expanding the role of postal workers and in turn expanding services, job security and profit.
Royal Mail: another critical juncture
Royal Mail is at a critical juncture yet again. After years of previous bosses decimating the service, the new ones do – as the CWU state – have a chance to turn the company around. However, this will only happen if they work with staff – something that has previously not happened. However, Ofcom’s intervention and the leaking of the details of it do not bode well.
Clearly, either the regulator is still on the same page as Royal Mail’s former bosses – or, it is reflective of the position the new management will take; that is, stripping the company back to little more than a red-logoed Uber. Either way, the CWU needs to act, and quickly, before another one of Britain’s great institutions is consigned to the dustbin of history.
Featured image via screengrab
