News story

Postal Services Bill completes passage through Lords

The consideration session in the Commons is the final stage before Royal Assent. Baroness Wilcox,** **Parliamentary Secretary for Business…

From:
Department for Business, Innovation & Skills
Published
24 May 2011
This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

The consideration session in the Commons is the final stage before Royal Assent.

Baroness Wilcox,** **Parliamentary Secretary for Business, Innovation and Skills, has taken the legislation through the House of Lords on behalf of the Government.

She said:

“I am delighted that our important proposals have passed through the Lords. This is a significant milestone in delivering our objective of securing the future of Royal Mail and the Post Office - two proud cornerstones of our society. I’d like to thank all the Peers who contributed to the many hours of rigorous, informed and passionate debate.”

During the Bill’s time in the Lords the Government listened to suggestions and made a series of amendments to further strengthen the legislation. The changes will give extra regulatory certainty to Royal Mail and increase transparency by putting even more reporting requirements on the Government.

During today’s Third Reading session Baroness Wilcox confirmed the next steps in the Government’s timetable:

  • Summer 2011- Postal Services Bill expected to complete its passage through Parliament
  • Summer 2011 - Government to submit state aid application to the European Commission
  • Spring 2012 - The new regulator for Postal Services, Ofcom, will establish the new regulatory framework for postal services
  • March 2012 - Target date for Government to take on Royal Mail’s historic pension deficit, subject to state aid clearance.

With these vital steps in place, the Government will be able to begin the process of securing the private sector investment that Royal Mail needs.

The Bill includes the following proposals:

Royal Mail

  • The requirements of the universal postal service - collection and delivery of post six days a week at uniform, affordable prices are written into the Bill. The Government has no intention of downgrading them.
  • Royal Mail will be able to benefit from an injection of private capital - ending the dependence on funding from the taxpayer and bringing new commercial disciplines into the business.
  • Alongside private sector investment:
    • At least 10 per cent of the shares in Royal Mail will go to its employees in the future. This will be the largest employee share scheme of any privatisation, larger than British Telecom, British Gas or British Airways.
    • Royal Mail will be relieved of its enormous historic pension deficit by the Government.
  • As part of a general reform of the regulatory regime for mail, the existing regulator, Postcomm, will be replaced by Ofcom, the communications regulator, with the Bill providing for the transfer of Postcomm’s regulatory responsibility to Ofcom.

Post Office

  • The network of around 11,500 Post Office branches is not for sale and there will be no programme of closures. Instead there is £1.34 billion of new funding to modernise the network and safeguard its future, making it a stronger partner for Royal Mail.
  • Under the proposals contained in the Bill, the Post Office could be converted into a mutual structure as part of innovative new plans to hand over its ownership and running to employees, sub postmasters and local communities.

Notes to editors

  1. The Postal Services Bill and an accompanying policy statement which explains the Government’s approach can be accessed here: http://www.bis.gov.uk/policies/business-sectors/postal-services/postal-services-bill-2010.
  2. The Postal Services Bill has been informed by the recommendations of Richard Hooper CBE in his independent updated report on the future of the universal postal service. “Saving the Royal Mail’s universal postal service in the digital age” was published on 10 September 2010. This report can be accessed here: [http://www.bis.gov.uk/hooper-report](http://www.bis.gov.uk/hooper-report).
  3. An online video on the Postal Services Bill from Postal Affairs Minister Edward Davey can be found here: [http://www.youtube.com/watch?v=sNqswvLPeRM](http://www.youtube.com/watch?v=sNqswvLPeRM).
  4. A further Q&A can be found here: [http://www.youtube.com/watch?v=T9ig0AbhqTs](http://www.youtube.com/watch?v=T9ig0AbhqTs)
  5. BIS’s online newsroom contains the latest press notices, speeches, as well as video and images for download. It also features an up to date list of BIS press office contacts. See [http://www.bis.gov.uk/newsroom](http://www.bis.gov.uk/newsroom) for more information.

Notes to Editors

Contact Information

Name BIS Press Office Job Title

Division COI Phone

Fax

Mobile

Email [email protected]

Name Joe Upton Job Title

Division Department for Business, Innovation and Skills Phone 020 7215 5959 Fax

Mobile

Email [email protected]

Updates to this page

Published 24 May 2011