Dáil debates

Thursday, 20 January 2011

Communications Regulation (Postal Services) Bill 2010 [Seanad]: Second Stage (Resumed)


3:00 am

Photo of Johnny BradyJohnny Brady (Meath West, Fianna Fail)

I also take this opportunity to voice my appreciation of my great colleague and friend, the former Minister for Transport, Deputy Dempsey, and of the former Minister of State, Deputy Wallace. I wish both of them and their families many years of happiness in their retirement. I also wish all outgoing Deputies who are seeking re-election the best of luck.

This Bill will shape the future of the postal market for generations. The changes it proposes must be carefully considered to ensure we do not make the mistakes made by other European countries in liberalising their postal markets, mistakes which led to job losses, higher costs and lower service levels. Postal delivery is a vital public service that must be considered as a basic right which connects every household and business to a communications and economic infrastructure that is essential to the social and economic well-being of the country.

In the absence of a proven method of financing there are serious questions to be addressed in regard to how the universal service obligation, USO, will be financed. Liberalisation will remove the restricted monopoly that appears to favour the establishment of a sharing mechanism. However, the Communications Workers Union, CWU, would prefer that all funding options are included in the legislation, including State aid. Nothing should be ruled out until we know what a liberalised market in Ireland looks like. We must take on board the lessons learned in other countries such as the United Kingdom where the USO is under serious threat as a result of regulatory choices that were made.

The experience of the Royal Mail indicates how important it is to get downstream access right. If it is handled poorly it could spell the end of An Post and the 10,000 jobs it provides. Access to An Post's network must be on a commercial basis. In addition, access to the network must not be below the mail centre level as this would render useless much of the investment in technology which An Post has made in recent years and would require the entire delivery network to be reconfigured. An issue of particular concern is the possibility of cherry-picking - also known as cream-skimming - whereby new entrants to the postal market would compete for business only on profitable routes. The effect of that would be twofold. It would reduce vital revenues for An Post, leaving it only with loss-making routes, which are of substantial number, and this in turn would threaten the viability of the USO.

Unfortunately, job losses and liberalisation go hand in hand. This has been the experience in almost every case where a postal market has been opened to competition, as shown by the comprehensive studies conducted by Union Network International across several liberalised markets. Another issue of concern is social dumping whereby decent jobs with reasonable terms and conditions are replaced by low-paid temporary jobs which force employees to maintain a dependence on social welfare, as in the case of Germany.

The social value of the postal service is widely acknowledged by people throughout the State, especially in rural communities. This becomes particularly clear when weather conditions are poor, as we have witnessed in the past 12 months. It is striking that there is no reference in the legislation to the postal network's role as a vital part of the fabric of our communities. Any decisions of a regulator must take into account the unique value the postal service has in Ireland. With a substantial rural population, particular care should be taken to ensure the interests of a competitive market will not take precedence over or put at risk this social function. It is a vital public service that is part of the fabric of our communities and provides a sense of national cohesion.


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