Royal Mail, NHS, Rail, Junior Doctors & Other Strike Issues

Second class letter deliveries on Saturdays could be cut..by Dearbail Jordan, Business reporter

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Royal Mail could be allowed to end the delivery of second class letters on Saturdays, as part of reforms being considered by the regulator.

Ofcom is also investigating whether to allow second class deliveries to be made on alternate weekdays, which could help cut costs for Royal Mail.

The regulator has been reviewing the Universal Service Obligation under which Royal Mail is required by law to deliver letters six days a week and parcels five days a week.

The number of letters sent through the post has been falling steadily for years while parcels volumes have grown, leading to millions of pounds in losses at Royal Mail.

Lindsey Fussell, Ofcom’s group director for networks and communications, told the BBC's Today programme the universal service “does need to change”.

“To be clear, no change is not really an option, otherwise it is going to be unsustainable and we’re all going to have to pay a lot more for it,” she said.

Royal Mail's owner, International Distribution Services, said that “change cannot come soon enough”.

It had proposed axing second class mail on Saturdays as well alternate weekday deliveries - both of which options are now being examined by Ofcom.

In theory, it would mean second class deliveries being made on Monday, Wednesday and Friday one week then Tuesdays and Thursdays the following week.

IDS chief executive Martin Seidenberg said: “The universal service faces a very real and urgent financial sustainability challenge."

Ofcom said no final decision had been made and it continues to review the possible changes. It aims to publish a consultation nearly next year and make a decision in the summer.

IDS is in the process of being bought by Czech billionaire Daniel Kretinsky for £3.57bn.

Last year, Ofcom fined Royal Mail £5.6m for failing to meet its first and second class delivery targets.

The number of letters being sent in the UK has halved since 2011, according to the regulator. In contrast, parcel volumes have jumped, especially during the pandemic when lockdowns led millions to shop online.

Royal Mail is also facing increased competition from other parcel delivery companies.

Royal Mail is a public limited company and is entirely separate from state owned Post Office.

First-class stamp price to rise to £1.65 from October 7th..Michael Race, Business reporter, BBC News

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Royal Mail has announced it will hike the price of first-class stamps by 30p due to "very real and urgent" financial challenges.

The increase, which will kick in from 7th October, will see the price of a first-class stamp rise to £1.65p, while second-class stamps will remain at 85p.

The company said it was facing pressure from declining letter volumes and rising business costs in maintaining the one-price-goes-anywhere universal service.

It has called for the service terms, under which it is legally obliged to deliver letters six days per week, Monday to Saturday, and parcels Monday to Friday, to be reformed.

"We always consider price increases very carefully. However, when letter volumes have declined by two-thirds since their peak, the cost of delivering each letter inevitably increases," said Nick Landon, chief commercial officer at Royal Mail.

"We are proud to deliver the Universal Service, but the financial cost is significant."

The decision to increase first-class stamp prices comes after the UK's postal regulator said on Thursday that the company could be allowed to end the delivery of second-class letters on Saturdays, as part of reforms being considered.

Ofcom has also said it is looking into whether to allow second-class deliveries to be made on alternate weekdays, which could help cut costs for Royal Mail.

But on Friday, Royal Mail said it still had "no certainty on regulatory reform".

The company, which was split from the Post Office and privatised a decade ago, has repeated its argument that the universal service is in need of "urgent reform".

It said that its minimum requirements had not changed for more than 20 years, despite changes in how people communicate.

In recent years, the volume of letters being posted has plummeted, while parcel deliveries have become more popular - and more profitable for Royal Mail.

But despite parcel postage growing and stamps being hiked several times in the past two years, the company has struggled financially, making a heavy £419m loss last year.

Royal Mail's performance has also deteriorated, with customers regularly not receiving letters on time, particularly for medical appointments and legal documents.

"The rate of letter decline and ongoing losses means that Royal Mail has had to take the necessary steps within its power to address the very real and urgent financial sustainability challenge the universal service faces right now," the company said.

According to Royal Mail, the amount of letters being posted have fallen from 20 billion a year in 2004-05, to about 6.7 billion in 2023-24, with the average household receiving four letters per week, compared with 14 about two decades ago.

Royal Mail has estimated that reforming second class services, plus changing its performance targets, could save the business £300m a year.

It had proposed axing second class mail on Saturdays as well alternate weekday deliveries - both of which options are now being examined by Ofcom.

However, reforming the postal service by cutting delivery days would require the government and parliament to change the current legislation.

Ofcom has said no final decision had been made on reforms. It aims to publish a consultation early next year and make a decision in the summer.

Royal Mail's parent company International Distribution Services is in the process of being bought by Czech billionaire Daniel Kretinsky for £3.57bn.

Mr Kretinsky has committed in writing to honouring the universal service obligation, but only for five years.

The takeover will face a government probe, including into potential links with Russia.

Junior doctors accept 22% pay rise to end strikes..by Nick Triggle, Health correspondent

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Junior doctors in England have accepted the government’s offer of a 22% pay rise over two years, ending their long-running dispute.

Members of the British Medical Association backed the deal with 66% voting in favour. Nearly 46,000 took part in the online ballot.

It brings to an end the 18-month dispute, which saw junior doctors take part in 11 separate strikes.

But the BMA warned it expected more above-inflation pay rises in future years or there would be "consequences".

The offer was made by Health Secretary Wes Streeting in late July – just weeks after Labour won the election.

He said he was “pleased” it had been accepted, ending the “most devastating dispute in the health service’s history”.

“This marks the necessary first step in our mission to cut waiting lists, reform the broken health service, and make it fit for the future," Streeting added.

The pay deal includes a 4% backdated pay rise for 2023-24, on top of the existing increase they have already received worth an average of 9% for the last financial year.

A further pay rise worth about 8% will be paid for 2024-25, as recommended by an independent pay review body.

That brings the total over the two years to around 22%, on average, for each junior doctor, with the lowest paid set to receive the largest increases.

The BMA had been campaigning for a 35% pay increase to make up for what it says are years of below-inflation pay rises.

As opposed to an incompetent government that during the previous 14 years led us to this situation

Absolutely.
Like Hayek they view any form of public service funded out of taxation as "communism"

You seem to indicate that they never received any pay rises over the years?

What was the decline in real net incomes for doctors between 2008 and 2022?

No problem, if the Nuffield Trust isn't a suitable source (🙄), the IFS has done some research too.

"Looking at trends in the English NHS, nurses saw a significant reduction in real pay over the 2010s (falling 7% between 2010 and 2019) and only a modest recovery since, with average nurse pay growing by a little less than 1% over the same 2019–23 period. Doctors also saw pay cuts between 2010 and 2019 (of around 10%) but, unlike teachers and nurses, have also seen their pay fall further in the period since 2019, making them the hardest-hit group of the three."

ifs.org.uk/publications/recent-trends-public-sector-pay