Postal Services Act 2011

The Postal Services Act 2011 is an Act of the Parliament of the United Kingdom. The Act enables the British Government to sell shares in the Royal Mail to private investors and includes the possible mutualisation of the Post Office.

The Act allows private buyers to own up to 90% of Royal Mail, with Royal Mail staff being offered at least 10% of the shares of the company.^[1] It enables the Post Office business to be separated from Royal Mail, to allow it to remain in government ownership or be mutualised. It provides for the government to take over the assets and liabilities of the Royal Mail pension scheme, which has a considerable deficit.^[1] It allows for the transfer of regulatory responsibility from Postcomm to the communications regulator Ofcom. The Act also writes into law the requirement on Royal Mail to maintain a 6-day a week universal service.

During its passage through the House of Commons, the government added an amendment to include a guarantee that a silhouette or portrait of Queen Elizabeth's head would remain on British postage stamps even if the Royal Mail were to be taken into foreign ownership.^[2] Following this stage it was considered by the House of Lords when the government added further amendments to safeguard the universal service.^[3]

The Act was granted Royal Assent on 13 June 2011 and the majority of its provisions came into force on 1 October 2011.^[4]

Summary of main provisions

• 1.1 The Postal Services Act 2011 (“the Act”) received Royal Assent on 13 June 2011. It provides, amongst other things, for responsibility of regulation for postal services to move from the existing regulator, Postcomm, to Ofcom
• 1.2 As part of the transition, there are a number of things which Ofcom either must do, or has the discretionary power to do. It also replaces the existing licensing regime with a general authorisation regime. The general authorisation regime will come into effect on 1 October 2011.
• • Ofcom may provisionally designate a universal service provider;
• • Ofcom may approve a consumer redress scheme and require postal operators to be a member of that scheme;
• • Ofcom must, in effect, transpose the existing licence conditions into initial conditions to apply under the general authorisation, including, as appropriate consumer protection conditions;
• • Ofcom may prepare a statement of the principles that we are proposing to apply in fixing administrative charges;
• • Ofcom must prepare and publish a statement of policy on information gathering for that year;
• 1.3 This Act, in relation to each of the above, sets out for consultation several proposals:
• • provisionally to designate Royal Mail as a universal service provider (section 2);
• • to re-approve the Postal Redress Service (POSTRS) and the consumer redress scheme criteria (section 3);
• • for the initial conditions (section 4);
• • for the charging principles (section 5); and
• • for information gathering (section 6).
• 1.4 Under the Communications Act 2003, Ofcom is required to carry out an impact assessment where a proposal in connection with the carrying out of our functions is “important”. A proposal is “important” if its implementation is likely to involve a major change in the activities carried on by Ofcom or have a significant impact on persons carrying on business in the markets we regulate, or the general public. Ofcom does not consider that any of the proposals in this consultation paper are “important” in this sense. The activities carried on by Ofcom are changing because of the Postal Services Act 2011 and not this consultation. Ofcom is not seeking to make any substantial changes to the regulatory regime. Most of the changes Ofcom is proposing are required by law.
• 1 These are charges that Ofcom can recover from postal operators.

Postal regulation: Transition to the new regulatory framework

• 1.5 Interested parties are requested to submit responses to this consultation to Ofcom by 9 September 2011.
• 1.6 Following consideration of responses, Ofcom will make decisions in order to ensure that the above are in place with effect from 1 October 2011.

References

External links

• Postal Services Bill – official page on UK Parliament website
• Postal Services Bill as explained by Postal Services Minister Edward Davey, part 1 on YouTube
• Postal Services Bill as explained by Postal Services Minister Edward Davey, part 2 on YouTube