Mail firms will have to serve rural areas

Click to follow
The Independent Online
RURAL AREAS will be protected under the Government's plans to break the Royal Mail monopoly on letter deliveries, MPs were assured yesterday, writes Colin Brown.

Edward Leigh, Under-Secretary of State for Trade and Industry, made it clear that private competitors for the mail business will have to offer a national service at a flat rate. Bidders will not be allowed to cream off profitable business, leaving unprofitable rural areas at risk.

Mr Leigh, a former member of the free-market, Thatcherite No Turning Back group of Tory MPs, told the Commons in one of a series of all-night debates that a 'free-for-all' market would push up prices and lead to a poorer service for some people. 'I do not think that full deregulation is appropriate here. Some routes would be inherently unprofitable and a free market would not provide them at an affordable price.'

For the Opposition, Jim Cousins said: 'Clearly a major retreat is on. It is in the right direction and we welcome that.'

Michael Heseltine, President of the Board of Trade, is expected to announce the plans to privatise the letter delivery service after Parliament's Easter recess, which began yesterday. But with the Government seeking to rebuild party morale, he may be denied time in the next session to push through the legislation.

However, many Tories support the plan to license limited specialist services. Opening the debate, John Marshall, the Conservative MP for Hendon South, called on the Government to sell off all three Post Office services, Royal Mail, Post Office Counters and Parcelforce - a move which is being considered.

'I believe it would serve industry and people more efficiently if it were in the private sector than if it were in the public sector,' Mr Marshall said.