The CWU has now conceded that the Royal Mail cannot continue to provide a six days a week delivery service under its Universal Service Obligation (USO). As previously reported, Ofcom has been driving a national debate on the future of the USO, which included a presentation at the DCA’s Spring conference to gather DCA member views. This was attended by a number of catalogue producing member companies along with lettershops, all of which could be impacted by any reduction in the delivery frequency offered by Royal Mail going forward.
Martin Walsh, CWU deputy general secretary said in an address at its national conference; “The reality is, the USO as a six-day option is no longer financially viable. The challenges we face are so significant, whether it is the USO, change, sale or possible takeover.”
This softening of the union’s attitude towards any change to the USO appears to have come about following the takeover bid of 320p per share made by Daniel Kretinsky, the largest single shareholder of Royal Mail. This could have had a major impact on CWU’s members if it succeeded.
The board of Royal Mail’s parent company, IDS, rejected the bid outright. Its view is that once the matter of a ‘dilution’ of the USO is progressed that the value of Royal Mail – which is currently loss-making – will be considerably increased.
Ofcom has yet to make its formal recommendations.
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