Mr. Christoph Mueller:

I currently have no relationship whatsoever with Deutsche Post and it is almost seven years since I left the company. However, my experience of privatisation is not limited to it.

For the information of members, I am not entirely sure, I believe the German Government just sold its last shares in Deutsche Post. Yesterday I read with some surprise the plan of the British Government to consider the privatisation of Royal Mail. That was first rumoured almost 15 years ago, but is not so easy to do. Very few post office services in the world have been privatised; only the Belgian, Dutch, German and Austrian postal services have been privatised. Even the United States has a state-owned postal service.

It is in the national interest to have a state-owned postal service and to retain that infrastructure. An Post has demonstrated that it is a very important service, particularly in a small country, where by definition there is not enough market share for two providers. One can see this applies to other public utilities. A country with a population of 4.5 million people cannot support two gas companies and so on.

Privatisation is not a default solution for postal services. It can be considered if the conditions are right but it will be very difficult to float a postal company in one go. What I see, if one wants to take the privatisation route, is that one must do it in tranches and release it slowly. The experience in Germany, and I have experience with Deutsche Airbus, with Lufthansa and a number of other companies that have been privatised in different steps during my career, was generally very positive, with no negative implications for employment, neither on the conditions nor the headcount. It was of course very healthy to increase competition. It is a little like a fitness programme.

The second question was on remuneration. I believe I answered that question. The difficulties in fulfilling the public service obligation is basically at the root of it. We must take into account of course that technology has greatly helped us to improve the service. I believe modern route planning and rostering opportunities might keep the delivery service at the same level but at a lower cost. An Post has demonstrated in the past three years that this is possible. Will a silver bullet solve the problem, that is, will one measure or one decision resolve it? I do not believe so. We must work on the cost side but with all respect the price of a standard 20 gram letter in Ireland is affordable. It is not in the top third in Europe. Letters are very affordable. It is legitimate, it happened in other European countries, to also think about the prices. Its service is extraordinary good.

I was asked about the pension deficit and whether a government should help out to close the deficit. The solution which obviously is on hand for An Post is very good. One must ask whether one means the Government, in its role as the sole shareholder of An Post, or the Government in general? In general one should reject the idea that the government should get involved in pension funds. I can witness that from another angle of attack. I believe the solution which is envisaged for An Post is very good and does not need further assistance by the State.

Again the issue of the philosophy of the situation was raised. We have to engage in a very sober assessment of the facts. In the case of An Post we must unfortunately work through some legacy. A proper analysis of the data between the years 2000 and 2007 would have revealed that the postal demand in Ireland and the correlation to GDP is the lowest in the European Union. The spread between letter growth and GDP is the widest. We have recognised a small amount of growth in letter and direct mail between 2002 and 2006, of 1.5% to 2%, while the GDP was the highest in Europe. Already then we could have seen that the decline in letter volume is inevitable and particularly severe in Ireland, which most people benchmark permanently with Sweden or Finland. We must take into account that the items per capitain Ireland are the lowest in Western Europe. We have 150 letters per person per year, taking everything into account. That is half of the top rate. That is the reason we must balance the distribution network. It is a special situation.

We cannot easily jump to the conclusion that what works in Sweden and Finland will work in Ireland. The development of the profit margin of An Post during the Celtic tiger years was the lowest in Europe. I believe that apart from the fact that we have structural issues that we must make good, An Post raised a very ambitious restructuring programme three years ago, that is on autopilot if one sees the efficiency improvements that have been achieved with the development of FTEs. I believe it needs more of the same. Let me respond to the question of whether it is enough when I have studied the numbers a little bit more carefully.