Friday, 27 July 2007

A tax on living in the countryside

A row is brewing over plans by the Royal Mail for something called 'zonal pricing' for postal services. The idea is that when a big business pays the Royal Mail to deliver in bulk it should pay more for delivery if its customers live in remote villages and less if they live in big cities where it is cheap to deliver. The worry is that over time businesses will pass these costs on so that in the end if you live in a small town or village you end up paying more for your services.

I was alerted to this by a group called the "Mail Competition Forum" who warned that nearly half the houses in Northavon could be affected.

The only catch is that the 'Mail Competition Forum' is the trade body for the people who want to compete with the Royal Mail. If the Royal Mail can offer discounts for businesses who want to post things to cities then the Royal Mail can compete with rival operators more effectively, and that is not what the trade association wants. So their concern is not entirely altruistic!

It seems to me that the answer is that if society thinks (as I do) that there is a value in having common prices for town and country, then the business that suffers through having to bear the additional costs (ie the Royal Mail) should get transparent public subsidy for providing the service, rather than be at a comparative disadvantage relative to the competition who, of course, aren't interested in delivering to remote farmhouses.

Things are never quite as straightforward as they seem!


Joe Otten said...

As a city dweller, the possibility of cheaper postage seems quite attractive on the face of it.

However I don't imagine it will be very practical to have different tiers of stamps for different zones for letters sent by Joe Public. No what will happen is that it will be cheaper to send me junk mail. I don't relish that at all.

Koosie said...

I am on complete agreement with you on this issue.The Mail service must continue to support the rural population as they support us city-dwellers in more ways than we understand.

I've still not forgotten about this, you know: