Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)

I tweet as well but I am not a twit. Having said that, this is serious legislation. I am opposed to it because I am ideologically opposed to its thrust. It is one of the hangover Bills from the Progressive Democrats, the agenda of which was fully endorsed by Fianna Fáil in various coalitions. It has now been embraced totally by the Green Party. I am opposed to it.

I was recently at the GPO, which is running an interesting exhibition entitled, "The Letters, Lives and Liberty". It shows the pivotal role of An Post and its predecessor in Irish history and society. I advise the Minister, Deputy Ryan, to attend the exhibition before he destroys one of our society's best organisations and the network it has created. Rural Deputies in particular would be able to outline the vital role played by An Post.

By privatising postage, the Bill will discard the proud record of An Post and end in tears, as it will ruin the postal service as we know it. It is a charter for cherry-pickers. Cherry-picking is a process whereby market entrants only provide services to the lucrative end of the market, leaving existing operators with most of the loss-making part of the operation. In terms of postal services, we can expect postal operators to be interested in large towns and cities, the likes of Dublin and Cork, while much of rural Ireland will be left alone because of its isolation. Due to the cost involved in daily deliveries, those areas would be left without a proper postal service and definitely without daily deliveries. This would make the provision of rural services non-viable for what remains of An Post without a significant price hike or subsidies from the taxpayer. Given our current crisis, the Minister should consider how we will need to bail out An Post.

Cherry-picking is not a possible outcome of the legislation. Rather, it is a certainty. The 2005 Ecorys report on the development of competition in the European postal sector predicted that private providers in Ireland will seek to operate in niche markets and certain geographical areas. Instead of establishing any genuine competition with An Post, private companies will simply take the easy profits. This will remove the revenue streams that are necessary for An Post to cross-subsidise the price of deliveries to rural homes. As a competing business, An Post will be left with few options. One would be to increase the price of stamps exorbitantly for rural post, another would be to seek Exchequer support and another would be to close up shop.

The so-called sharing mechanism outlined in the Bill is a non-runner. The Bill provides that ComReg may, at an unspecified time, develop some sort of mechanism to have new private operators compensate An Post for the burden of the latter's universal service obligation. Deputies should remember the debacle that was the battle over risk equalisation in the health insurance market, which was liberalised in the not-too-distant past. We all know how that ended. The compensatory transfers necessary to ensure community ratings were successfully challenged by the new insurance entrants. Cherry-picking still continues. This situation has contributed to what is fundamentally a piecemeal system as well as to phenomenal price hikes, such as those announced by the VHI last week. Likewise, private postal companies will challenge the proposed sharing mechanism as a barrier under EU competition law. A likely outcome of the Bill will see the taxpayer needing to bail out An Post. Given that An Post would not need a bailout in the absence of private operators, it is important to ask who those operators would benefit. In this case, the beneficiaries would be the usual suspects, namely, Germany and Britain.

I have more to say on this matter. The Bill is based on the policies of a former Deputy and Commissioner, Mr. Charlie McCreevy. It is interesting that today he is a director of one of Ireland's most anti-union companies, Ryanair. It is regrettable that he has strange bedfellows in the Labour Party, which supported the European directive from which this Bill stems and failed to oppose the Bill in the Seanad. I urge Labour Party Deputies in particular to concentrate more on this Bill and to oppose it and the political and ideological agendas behind it.

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