Royal Mail’s new Czech tycoon owner refuses to give “unconditional” promise of tackle the firm’s missed targets on letter deliveries
The billionaire owner of Royal Mail has apologised for the postal giant’s deliver “chaos”, but denied it was getting worse.
Czech tycoon Daniel Kretinsky told MPs: “Of course I am deeply sorry for any letters that arrive late.”
However, he denied Royal Mail’s track record for letters arriving late was deteriorating. And, during a grilling by MPs, he said: “It is not perfect, but it is not catastrophic.”
That was despite claims that 220 million letters – whether first or second class – will not arrive on time this year. Mr Kretinsky was making a rare public appearance as he was grilled by the Commons Business select committee.
Liam Byrne, chair of the committee, asked Mr Kretinsky whether he would commit to do “whatever it takes to get this service back to what the nation expects.”
Mr Kretinsky, nicknamed the Czech Sphinx, replied: “Not unconditionally. We need to implement the USO reforms. Without the reforms we have no way of how to fix it.”
The USO – or universal service obligation – is a legally binding commitment requiring it to collect and deliver letters to every UK address six days a week.
Mr Kretinsky, who stressed he was a “numbers person”, said: “I truly believe that Royal Mail has a future.” He said he was “driven by the challenge and not by profit, but I know that if we do the right thing we create value at the end of the day.”
The tycoon, through his company EP Group, sealed a £3.6billion deal to buy Royal Mail and owner International Distribution Services last year.
It comes as Royal Mail prepares to hike stamp prices yet again from April 7. The cost of a first class stamp will increase by 10p to £1.80, while a second class stamp will go up by 4p to 91p. The price of a first class stamp was just 64p in 2016 – meaning it will have increased by 181% in the past decade.
Dave Ward, general secretary of the Communication Workers Union, earlier told MPs: “The service at the moment is chaotic. The people who are responsible for that, you have to go back a few years. But for workers it is a demoralising environment.
“All they want to do is come into work and delivery their deliveries as they always used to do. Now they come into work and they know it is going to be extremely difficult to get through all of the workload.”
He warned strikes were now possible, adding: “We don’t want to be in a position where we have to talk about industrial action, but we cannot rule it out.”
Mr Ward added that 20,000 staff have been axed since Royal Mail was privatised, meaning the workload for the remaining workers has got heavier.
Martin Walsh, CWU deputy general secretary, claimed posties were told to leave doctors’ letters in sorting offices in order to prioritise special delivery and tracked items.
Liam Byrne, chair of the Business Select Committee, said the scale of the problem with late letter deliveries meant missed hospital appointments and more. “It’s badly affecting our national life as a country,” he said.
Mr Ward claimed Royal Mail’s financial difficulties were partly of its own marking. He told MPs that, in 2022, Royal Mail decided to hand almost £600million back to investors in dividends buy share buyback schemes. “Within a matter of months they were claiming they were almost bankrupt,” he said.
He also claimed the current delivery issues date back to scheme where he said managers were incentivised to reduce delivery routes, and “drive out” long term workers and new terms and conditions.
“The chaos started from then’,” he added. “This is a self-inflicted problem. They have chosen to make a number of decisions that completely devalue a postal workers’ job.”
He claimed Royal Mail was looking at other courier companies as a template of how to operate. “We think there are people in the company who want to accelerate letter decline,” Mr Ward added.
