26 March 2001

RADICAL REFORM OF POST OFFICE COMPLETED

Alan Johnson hails biggest changes to the Post Office since 19th century.

Industry Minister Alan Johnson today welcomed the Postal Services Act coming into effect, bringing to fruition the Government's programme of Post Office reform.

Mr Johnson said:
"The Postal Services Act will bring about the most radical reform of the Post Office since Rowland Hill introduced the penny post in 1840."

"The act changes the nature of the Post Office, transforming it from a statutory authority into a plc owned by the Government, enabling it to compete more effectively in a changing global communications market."

"The Post Office company will be licensed to deliver the post by the independent regulator, the Postal Services Commission (known as "Postcomm")."

Postcomm will ensure that the universal service obligation, the delivery of post to every address in the UK at a uniform tariff, is maintained. It can also licence other companies to operate in the licensed area.

The Consumer Council for Postal Services, or "Postwatch", has been established to act as the consumers' champion, working with the regulator to improve standards.

Alan Johnson added:
"These changes fundamentally alter the postal services market in Britain, paving the way for greater competition and higher standards of service to consumers throughout the whole country. Postal services are a vital part of the UK's economic and social life and we intend users of postal services to be the real winners from these changes."

"I'm confident that the new Post Office company will now be better able to provide the efficient postal services that we need to support the business and social life of the nation in the 21st century."

The Postal Services Act 2000 consolidated the reforms proposed in the Post Office White Paper and received Royal Assent on 28 July 2000.

Notes to editors:

1. The Postal Services Act 2000 has been brought into force progressively since Royal Assent by a series of Commencement Orders. The latest such Order commenced all the remaining major provisions of the Act and applied the schemes under which the Post Office has traditionally carried out its postal and postal order business to the Post Office company and its subsidiaries. The only provisions of the new Act still to be commenced are a few repeals of the Post Office Act 1969 which are being retained until the Post Office is dissolved in accordance the new Act.

2. In accordance with the Act, the business of the Post Office has been transferred to the company nominated as the Post Office company, i.e. Consignia Holdings plc.

3. The operational functions of the Post Office company will be carried out by its wholly owned subsidiary, Consignia plc. In accordance with Part II of the Act, the Postal Services Commission has granted a licence to Consignia plc permitting it provide the postal services which are restricted under section 6 of the Act, and requiring the company to provide a universal postal service within the United Kingdom. Consignia plc (registered number 4138203 of 148 Old Street, London EC1V 9HQ) is thus a universal service provider for the purposes of the Postal Services Act.

4. The initial directors of the initial directors of the Post Office company and the directors of Consignia plc are the current members of the Post Office board, i.e. Neville Bain (Chairman), John Roberts (Chief Executive), Jerry Cope (Managing Director Strategy and Business Development), Ms Marissa Cassoni (Finance Director), Mike Kinski, John Lloyd, Miles Templeman and Ms Rosemary Thorne (non-executives).