Royal Mail in trouble? Now, who would have guessed that, Vince?

(Royal Mail)

Outlook Remember when the Government told us the Royal Mail flotation would ensure letters would be delivered from Land’s End to John O’Groats forever?

Floating the service on the stock market would bring in extra capital to pay for modernisation and efficiency drives at the new plc, enabling it to afford the so-called Universal Service Obligation, we were assured.

The trouble was, within months of the float, chief executive Moya Greene – a good sort who has refused an offer of a megabonus – started clamouring for a rethink of how the so-called USO operates.

We don’t mind providing the service, she said, but it wasn’t fair that her rivals were allowed to “cherry pick” more lucrative routes in urban areas, leaving her lot lumbered with those hard-to-reach rural corners.

Cynics might suspect the arrival of the lobbying firm Open Road might have something to do with the rising noise now urging Ofcom to bring forward its review.

But whoever’s brainchild it is, with Ms Greene yesterday raising yet another threat to her company in the form of Amazon, the calls are getting deafening.

“Change the way the market operates” is easy to say, but harder to do.

Killing off the USO, and leaving rural communities at the whim of the markets, would be political suicide. It would also require an Act of Parliament which would, frankly, never happen.

An alternative is to demand all companies chip in to the universal service: this would be terrific for the Royal Mail share price, as it would ruin its rivals’ business models overnight. But it’s not very British to interfere in the private sector.

Which leaves us with another idea: simply give the Royal Mail a taxpayer subsidy to keep the service going. Sounds pretty reasonable, but would that be allowed under European rules? Doubtful. And besides, taxpayers would not be too chuffed to be bankrolling a private company which is behind on its modernisation and efficiency commitments.

Which all puts Ofcom in a jam. No wonder it doesn’t want to be bounced into make any rash decisions.

But, as the volume of complaints demanding regulatory action rises in the coming months, don’t forget: Vince Cable told you privatisation was the solution.