Cable accuses Royal Mail of 'scaremongering' and 'whinging'

Business Secretary Vince Cable has accused Royal Mail of "scaremongering" over warnings it may not be able to continue with its universal service.

Mr Cable told ITV News that chief executive Moya Greene's comments amounted to "special pleading" - and said the Government did not want companies "whinging" about being in a competitive market.

Live updates

Vince Cable accuses Royal Mail of 'scaremongering'

Business Secretary Vince Cable has accused the boss of Royal Mail of "scaremongering" in claiming the universal post service is under threat.

Chief executive Moya Greene has warned that the high cost of the service, which ensures a same-price delivery for letters anywhere in the UK, six days a week, is not sustainable in the face of competition in high-density, low-cost areas.

ITV News business editor Joel Hills reports:

Royal Mail is ‘wrong’ to scare public over universal service

Business Secretary Vince Cable has criticised Royal Mail bosses for “scaremongering” by indicating universal service may be under threat.

He said he felt it was "wrong" of chief executive Moya Greene to suggest it is.

He said a lot of people “depend” on the Royal Mail and the regular delivery it provides, particularly in remote areas, and he said they should not be made to feel insecure.

I think it’s wrong to scare the public.

The universal service obligation is absolutely clear, it’s protected in law by Parliament, it’s not going to change.

I think a bit of scaremongering is going on and it’s not healthy.

– Vince Cable, Business Secretary

Advertisement

Cable: Email is the biggest competition for Royal Mail

The privatisation of Royal Mail has gone “admirably” but the biggest competition to business was always going to be the ever-growing popularity of email, Vince Cable has said.

The Business Secretary told ITV News that the major objective of privatisation had been to allow Royal Mail to go out and compete and raise money on the open market for investment, which it had – raising £500 million to date.

But, he said, they were always going to have to compete with e-mail, which was replacing much of its traditional custom, on top of having to compete with other mail carriers.

Cable accuses Royal Mail bosses of 'scaremongering'

Business secretary Vince Cable has accused Royal Mail bosses of "scaremongering" by claiming the universal service is under threat.

He told ITV News the universal service obligation - which ensures people can send post anywhere in the UK for the same fixed price - is enshrined in law and will not be rescinded.

He said were it to be overturned, both Houses of Parliament would have to vote to do so - which, he added, is not going to happen.

It comes after Royal Mail chief executive Moya Greene warned that increasing competition in high density, low cost areas was threatening the universal service by making delivering to rural and remote areas not economically viable.

Mr Cable said Royal Mail, now it is only 30 per cent owned by the taxpayer, was free to raise capital privately - and said it had already raised £500 million to invest and compete.

He said the government did not want to see companies "whinging" about having to operate in a competitive market.

Cable: Royal Mail is 'scaremongering' and 'whinging'

Business Secretary Vince Cable has accused Royal Mail of "scaremongering" over warnings it may not be able to continue with its universal service.

Mr Cable told ITV News that chief executive Moya Greene's comments amounted to "special pleading" - and said the government did not want companies "whinging" about being in a competitive market.

ITV News Business Editor Joel Hills tweeted:

Royal Mail warns more competition 'undermines' service

Royal Mail bosses today issued a warning that giving people more choice between delivery services was threatening the future of the universal service, which guarantees that letters can be delivered anywhere in the country for the same price.

Royal Mail bosses have warned against allowing 'cherry picking' between competitors Credit: PA

Chief executive Moya Greene told a committee of MPs that the high cost of the universal service obligation – around £7.2 billion a year – was in part because of the difficulties of delivering to rural and remote parts of the country.

Delivering to high-density areas such as the inner city was much lower cost and helped to subsidise these deliveries – but by allowing these customers to “cherry pick”between Royal Mail and their competitors the system was unsustainable.

Advertisement

Back to top