Mr Hunt defends steep rises in postal charges

Press, 24 February 1987, Page 20

Mr Hunt defends steep rises in postal charges

Betty E. Higgins, of Greta Valley Village, has challenged the Post Office to justify its recent increases in charges. The Postmaster-General, Mr Hunt, responds by saying that the Post Office must charge realistic prices for the service it provides. In a letter to the Editor, Betty Higgins writes:

“I would be interested to know just how the Post Office can justify the 100 per cent increase in charges for a non-service? I refer to the new postal rates, which include private boxes and rural deliveries.

“The charge for a private box where postman’s delivery is not provided has increased 300 per cent since 1983 and there is no alternative for those who are required to have a private box and must pay for the privilege of collecting their mail from the post office while in cities and towns, however small, there is a postman’s delivery for all at no charge. At least those on rural delivery have their mail delivered to their gates for the same amount that the boxholders must pay for no service at all.” Mr Hunt replies:

“It would, I think, be fair to say that there is never a time when a price increase for a universally used service such as the post would be welcomed. As I indicated in announcing the increase, the simple fact is that the postal business incurred a loss of 523.7 M in the last financial year;and, in spite of the A

recent increase, these losses are expected to double in the current financial year. “My Government colleagues and I are not unmindful of the impact postage rate increases have on all users, and in particular on those people on fixed or low incomes. Nevertheless, if the Post Office is to be in a position to respond effectively to the demands and expectations of its customers, it must charge realistic prices for the services it provides. The alternative would be for the Post Office’s losses to be met by all taxpayers, whether or not they use the service provided, and few people would regard that situation as being an equitable arrangement.

“As far as the increase in private box charges is concerned, the fact of the matter is that, for delivery by postmen or rural delivery, the run encompasses the whole of a specific area and the incremental costs in delivering to additional houses or rural delivery boxes on the existing route or delivery is quite small and, in many cases, would be negligible. On the other hand, private box service requires the Post Office to provide costly accommodation to house the boxes (and in some offices, the space required is very great indeed). The boxes and the area in which they are located need to be maintained regularly and there are cleaning, heating and lighting costs which must be taken into account. Additional

staff are needed to sort the mail into the boxes and to deal with counter service, to customers in private box lobbies.

“These costs will vary, depending on the size of each particular local operation, but in total they are quite significant, especially those in larger centres where mail is sorted into boxes progressively during the day six or seven days a week, as compared with postmen’s or rural delivery sorting, which takes place only during a short period prior to the commencement of deliveries each day.

“In summary, the provision of private box service entails quite heavy costs over and above those incurred in the delivery of mail by postmen. The rental charged for private box service is intended to offset these added costs.

“It is a matter for Betty Higgins to decide whether the convenience offered by private box service is sufficient to justify the rental she is required to pay, bearing in mind that she could have her mail addressed care of the Greta Valley Post Office, for which there is no charge. The mail would, however, only be able to be uplifted when the office is open. In the case of areas such as Greta Valley Village the Post Office recognises the fact that no postman’s delivery is available and charges a. lesser box rental than would otherwise apply.”