DEEP concerns have been raised that the Royal Mail's six-day a week universal service obligation (USO) to Scotland and the rest of the UK is under threat from increased competition.
Royal Mail's 21 per cent fall in its six-month operating profit to £279m was less severe than many analysts had predicted but there was a warning that online retailer Amazon's delivery service would more than halve the growth potential for the parcel business of the former state-owned company.
Twelve months on from its controversial flotation, Royal Mail shares stand at about 430p, having slumped eight per cent in the past 24 hours and by 30 per cent from their February peak.
The firm has argued rivals are able to cherry-pick the services it offers, putting the USO at risk.
Moya Greene, the Royal Mail's chief executive, pointed to the problem of unfettered direct delivery competition, saying there was an "urgent need for a new framework that will secure the sustainable provision of the universal service for the future".
No 10 sought to play down fears about the USO, making clear the changes to the Royal Mail, which had been haemorrhaging millions of pounds a year, were made to make it a successful company and that ensuring this was the case would guarantee the universal service.
Ofcom, the industry regulator, also emphasised how protecting the USO was at the heart of its work.
But Chuka Umunna for Labour said it was clear the Government's "fire sale" of Royal Mail was putting the universal service at risk and called on ministers "to give assurances on the future of Royal Mail's services and what action they will be taking to defend the USO".
Mike Weir for the SNP said it was "painfully clear the UK government should never have sold off a valuable public asset at well below its true value and despite all the warnings about the end of the USO".
He added: "We know the majority of Scots were opposed to the privatisation of Royal Mail; more than any other part of the UK. We need a postal service that meets the needs of our communities and one which is brought back into public ownership."
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article