Over the last week a committee of members of parliament (the Commons Business Committee) has been considering the Royal Mail and OfCom proposals.
On 21 February, the BBC reported that
MPs have challenged a regulator about plans to remove price caps on first-class stamps and raise the price limit on second class to as much as 55 pence.
On 28 February....
Moya Greene told the Commons' Business Committee that the cost of stamps would have to rise.
Plans to increase the prices of stamps will not lead to an "affordability issue", the Royal Mail chief executive has told MPs.
Most of the British press - but not apparently the BBC - also reported on plans to allow benefits claimants to buy stamps for Christmas at current prices. This from the Telegraph online:
"For the first time, stamp prices will be frozen for some pensioners and benefit claimants to help them with the cost of sending Christmas cards this year. The deal will be limited to a few weeks in December and Royal Mail said customers would be rationed to prevent abuse of the scheme. It is preparing for a public backlash when it announces large rises in the cost of first and second-class stamps.
Moya Greene, the chief executive of Royal Mail, told MPs on the business, innovation and skills committee that first and second-class Christmas stamps sold over the festive period would be pegged to 2011 prices for “vulnerable families”. She said that more than half of all consumer mail was sent over the Christmas period. "
This was under the headline:
Millions to be offered cheap Christmas stamps as Royal Mail fears price rise anger
Outrage over Royal Mail plan to offer cheaper stamps to five million claiming benefits
So how would that work, and how would it be controlled? And why is it that if - according to Royal Mail - the average individual posts only one letter per week, that the extra 15-19 pence would be so much of a hardship? Although prepared for a public backlash over the price rise, Royal Mail appears unconcerned by a backlash from hard-pressed taxpayers and businesses subsidising others - because surely the cost of these cheap stamps must be factored in to calculating the new tariffs that everybody else will be paying?
Maybe the clue is in the last sentence - "more than half of all consumer mail was sent over the Christmas period". Of course Christmas is a very expensive time for everybody who buys cards and presents. So why give a discount on both 1st and 2nd class stamps? If those on benefit plan their Christmas posting they can send everything 2nd class, so they won't need discounts on 1st class stamps. (Anyway, at Christmas there's little point in using 1st class stamps as most of the post travels together!)
How many people would benefit? The Mail figures show some 4.5 million on one or another state benefit. Assuming they post half of their average 1 letter per week at Christmas, that's 26 each making 117 million stamps. And at, say, 16p each (assuming a rise from 36p to 52p) that's £18,720,000 that has been factored in to the new prices to ensure that Royal Mail doesn't lose any more, because the rest of us will pay the full price.
Today the BBC reports that:
Stamps price rise is backed by MPs
A committee of MPs has given its backing to a planned rise in the price of stamps, despite raising concerns about the cost to vulnerable people.The Commons Business Committee said it was "appropriate" for the price of first class stamps to increase above the current 46 pence. It also accepted that second-class stamps should go beyond the current price of 36p.
I'm sure that will give all of you a nice warm feeling that you are helping the needy.