Rural parts of Wales could pay more for postal services

Royal Mail said that the Universal Service is under threat

Rural Wales could suffer if competition continues to jeopardise the Royal Mail, a business organisation has said.

The South Wales Chamber of Commerce said areas of Powys, Ceredigion and Carmarthenshire, among others, might have to pay more for postal services.

Shares in Royal Mail dropped by 8.3% after the company warned rivals are "cherry picking" urban mail routes.

The company said it is struggling to give the same prices to all under its Universal Service.

It has repeated calls for regulator Ofcom to consider expanding the UK government-mandated Universal Service - which ensures mail is delivered across the UK, six days a week and at a fixed price - to rivals such as Whistl.

Royal Mail said the delivery firm could wipe £200m off its sales, but insist it is "committed" to continuing to provide a "uniform price across the UK's 29 million homes and businesses".

Cannot afford to travel

The South Wales Chamber of Commerce, the Campaign for the Protection of Rural Wales and the Farmers' Union of Wales are among six Welsh companies to give submissions to the UK parliament on the consequences of growing competition in the postal sector.

Director of the Campaign for the Protection of Rural Wales Peter Ogden has said it will be "yet another nail in the coffin" for people living in remote parts of Wales.

"Service provision of any kind often lies on a delicate knife edge in rural Wales," he said.

"Why should someone unable to or who cannot afford to travel an extra 10 miles to post a letter suffer if no local collection service is available?"

Postal services, such as stamp prices, could rise the Universal Service is not upheld

Director of the South Wales Chamber of Commerce Graham Morgan added: "If organisations are encouraged to cherry pick, anywhere outside the big cities in Wales could struggle.

"Places like Lampeter and Tregaron would be affected, where private citizens rely on the Royal Mail service.

Public scrutiny

"Postal services should have an obligation to sustain business to all parts of Wales and not undermine the systems that are in place, Royal Mail has been a custodian in Wales and we need to sustain that."

Royal Mail has been under increased public scrutiny since it was privatised in October 2013.

"Allowing the integrity of the current postal arrangements to be salami sliced will we believe disadvantage those at its extremities, those living and working in the remoter rural areas of Wales," Mr Ogden added.

"We are committed to continuing to provide the six day a week service, at a uniform price across the UK's 29 million homes and businesses.

We believe Ofcom should conduct an early review of the postal delivery market in order to fulfill its primary duty of protecting the universal service for all and to determine quickly the regulatory changes needed to safeguard it."