Business, Innovation and Skills written question – answered at on 12 February 2013.
To ask the Secretary of State for Business, Innovation and Skills what steps his Department is taking to safeguard the Royal Mail's universal service following its privatisation.
Richard Hooper's report in 2008 and his updated report in 2010 made three clear recommendations to secure the future of the universal postal service. Government accepted these and, through the Postal Services Act 2011, Parliament implemented them. So far we have relieved Royal Mail of its historic £10 billion pension deficit and established a new regulatory regime. The final phase is to give Royal Mail access to flexible private capital that is needed to ensure that it is successful and sustainable in the long-term. The Government will also honour its commitment that at least 10% of shares will be made available to employees.
Parliament has guaranteed through the Postal Services Act continuation of collection to delivery of letters six days a week throughout the UK at uniform, affordable prices. Royal Mail will continue to provide the universal postal service to these standards regardless of its ownership.
The Act gives Ofcom a clear statutory duty to secure the provision of the universal postal service and the powers to intervene if the universal service is at risk. Those powers will continue to apply after there has been a sale of shares in Royal Mail.
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