An inquiry into competition in the UK postal sector has been launched, after calls from Royal Mail to protect it from last mile delivery competition earlier this year.

The Business, Innovation and Skills (BIS) committee yesterday said the inquiry would investigate access, end-to-end delivery of mail, the parcel delivery services available and the impact of competition on Royal Mail’s obligation to deliver a universal service.

Royal Mail, which in June called for regulator Ofcom to protect it from last-mile delivery competitors such as TNT Post, recently renamed Whistl, welcomed the inquiry.

“We will play our full part in the committee’s inquiry into the key issues for the universal service and the UK,” a spokeswoman for Royal Mail Group said.

Royal Mail earlier this year claimed that Whistl’s plans to expand its final mile delivery service across the UK could knock £200m from its turnover by 2017-18. It was also concerned that its upfront costs would increase as more final-mile delivery players enter the market.

A Whistl spokeswoman said: “We are happy to take any opportunity to explain the benefits of competition in the UK postal sector and its important role in ensuring Royal Mail continues to work towards meeting its productivity targets which it has so far failed to do.

“We are proud to deliver innovative, quality and value for money services that our clients want and are creating much needed new jobs across the UK,” she added.

A complaint made by Whistl earlier this year, which claimed that Royal Mail had breached its obligations to other carriers, is also being investigated by Ofcom.

The formal complaint claimed that, by changing the terms of its final-mile delivery contracts with other carriers, it was in breach of its regulatory conditoons . The investigation is ongoing and is expected to conclude by the end of this year.

Topics