04 February 2011
On 03 February 2011, Royal Mail published indicative wholesale prices for 2011-12, which take into account our November proposal to move to a wholesale led form of price control. This early indication of potential prices was anticipated in our November document, “Laying the foundations for a sustainable postal service”. Royal Mail states that its indicative prices are based on our “minded to” decision to approve Royal Mail’s application for additional allowed revenue.
As originally envisaged, Postcomm will not be making a final decision on this or other relevant changes to the regulatory framework for 2011-12 until the middle of February. If Royal Mail’s application for additional revenue is approved, it will be for Royal Mail to decide how to set its final prices consistent with the requirements of its licence.
Separately, and also as anticipated, we have been discussing with Royal Mail the detailed implementation of our decision on the two safeguards of cost transparency and accounting separation that we decided upon in November. In reaching a final decision on the scope and extent of the associated de-regulatory package of measures we proposed, we will be considering carefully the issues raised by interested parties in response to our November document and our December consultation on cost transparency (which closed on 31 January), as well as Royal Mail’s position at that time on the implementation of these safeguards.
We plan to publish our decisions on these matters as soon as possible after a decision has been taken in February and to begin the statutory consultation on the licence conditions required to implement them shortly after that.
We expect then to move forward quickly with developing for consultation initial proposals for the 2012 regulatory framework.
For further information on the indicative wholesale prices please visit Royal Mail's Wholesale website [Link]