He will let Ministers have his initial views in the summer and will publish a fuller update by early autumn.
Vince Cable said:
“Unless we take the right steps Royal Mail risks being laid low by falling mail volumes, low investment and a huge pensions’ time bomb. We want to deal with these challenges and will be coming forward with new legislation to do just that.
“We believe that Richard Hooper’s recommendations and analysis are still broadly valid today, but as our policy develops we want to be able to test it against current market conditions. Richard’s in-depth knowledge and experience will enable us to take account of recent developments in the postal market.”
Richard Hooper said:
“When I published my report eighteen months ago, I concluded that the universal service was under threat and there was a consensus that the status quo was untenable. Developments since then have seen letter volumes continuing to decline and Royal Mail continuing to modernise its operations, helped by the recent agreement between the management and the CWU.
“I welcome the opportunity to update my report and look forward to hearing from all those whom we consulted last time and from others who have an interest. “
The update will consider recent developments in the postal sector and Royal Mail and test whether the underlying issues which threatened the maintenance of the universal postal service remain. It will look at whether the original recommendations still provide the best solutions to the challenges faced by the company.
Organisations with an interest in this area will be invited to submit their views, including Royal Mail, Postcomm, Ofcom, the Communication Workers Union and Consumer Focus.
The Queen’s Speech set out that a Postal Services Bill will be introduced during this session of Parliament. The Bill will enable the modernisation of Royal Mail, in partnership with employees, and will ensure it benefits from private sector capital and disciplines
The Coalition Agreement committed that the Government will seek to ensure an injection of private capital into Royal Mail, including opportunities for employee ownership. The Post Office will be retained in public ownership due to its hugely important social and economic role in communities throughout the UK.
Notes to editors:
- The review’s terms of reference are:
- To consider developments in the postal sector and Royal Mail since the publication of the Review’s final report.
- To test whether the underlying issues which threatened the maintenance of the universal postal service remain.
- To consider whether the recommendations in the report still provide the best solutions to maintaining the universal service.
- An independent review of the postal services sector, chaired by Richard Hooper, was undertaken between December 2007 and December 2008. The review looked at changes taking place in the postal and wider communications markets and what the implications of those changes were for the UK postal service, in particular the provision of the universal postal service.
The review published its final report on the 16 December 2008 (“Modernise or Decline: Policies to maintain the universal postal service in the United Kingdom”). At the heart of the report were three linked recommendations:
- Pension deficit as part of a package of changes, the government should take over responsibility for reducing substantially the pension deficit.
- Partnership to improve the Royal Mail’s performance it should forge a strategic partnership with a postal operator with a proven record in transforming its business, working closely with the workforce.
- Regulation Hooper proposed that Ofcom should take over responsibility from Postcomm for regulating the postal market. Its primary responsibility being to maintain the universal service in the wider context of the other changes taking place in communication markets.
Richard Hooper CBE was Deputy Chairman of the Office of Communications (Ofcom) between 2002 and 2005. He stood down as Chairman of Informa plc in May 2007 after ten years on its Board. He is currently Senior Independent Director at YELL Group plc and at VocaLink Holdings Ltd. He was Chairman of the Radio Authority for 3 years until 2003. Previous directorships include MAI plc, United News & Media, Superscape plc, IMS Group plc, i-mate plc and Artilium plc. He is a lead mentor for Bird & Co Boardroom and Executive Mentoring, and an adviser to Telecom New Zealand on the regulatory implications of ultrafast broadband. Before the Election, he chaired the Selection Panel for the Secretary of State, Culture Media and Sport which chose the winning bids for the Independently Funded News Consortia (IFNCs) in Scotland, Wales and the north of England.
A Postal Services Bill will be introduced during this session of Parliament. The Bill will help to safeguard the future of the Royal Mail and the Post Office network - giving employees a secure future and consumers and businesses a service they can continue to depend on. The Government has made the following commitments.
20 May Coalition Agreement: “We will seek to ensure an injection of private capital into Royal Mail, including opportunities for employee ownership. We will retain Post Office Ltd in public ownership.”
20 May Coalition Agreement: “We will ensure that Post Offices are allowed to offer a wide range of services in order to sustain the network, and we will look at the case for developing new sources of revenue such as the creation of a Post Office Bank.”
25 May Queen’s Speech: “My Government will modernise the Royal Mail, in partnership with employees, and will ensure it benefits from private sector capital and disciplines.”
Notes to Editors
BIS Press Office