Thomas Pringle (Donegal, Independent) | Oireachtas source

The Bill deals with the universal service obligation and the need for An Post to have a price increase in the cost of postage to try to shore up its financial position in the current climate. As has been outlined, we had the cheapest postal prices in the European Union; therefore, the increase would probably only bring the price into line with EU levels. However, the crisis in An Post has also been created by the European Union. As other speakers have outlined, the post office network and An Post itself have a social responsibility and play an important social role in terms of everyday life across the country. The problem is that none of the EU regulations under which An Post operates recognise that, other than the universal service obligation and that is the crux of the problem we face in An Post. Until we as a people and a Government accept that An Post has a social role and we step up to that social responsibility, An Post will always be in crisis and it will be a case of diminishing returns until such time as the Government throws its hands up and says it can do no more and An Post will cease to exist. That would be a disaster for the 10,000 people whose work depends on An Post. It would also be a disaster for the millions of people across the country who depend on the postal service for the delivery of their post but also for the social contact involved in the postman calling to the house to deliver the post.

The banks and large utility companies have pushed customers to e-billing and e-statements, which has taken away a segment of the previous business of An Post. It is a cheap way for the banks and utility companies to deliver their bills. It was outlined by previous speakers that the price increase could speed up the process of encouraging others who currently use the postal service to change to e-billing, e-statements and e-communications rather than continuing to use the postal network. I am also concerned that the price increase could have the unintended effect, or perhaps it is a desired effect, of enticing private operators into the postal delivery service in more densely populated areas.

I am reminded of the situation with electricity. We had the cheapest electricity in the European Union in 2002. The ESB, a semi-State company, was providing electricity at a very cheap cost for consumers across the country and it also made a profit, but when the EU decided the electricity market had to be deregulated, liberalised and opened up to competition, we discovered that electricity was too cheap to provide competition as the price would not attract any private operators into the market. The energy regulator embarked on a programme of forcing the ESB to increase its prices over a number of years in order to entice private operators into the electricity market. I am concerned that a price increase in An Post would have the same effect of making the market more attractive for private operators to carve up some of the business for themselves. In deciding whether to enter the market and compete with An Post, they will look at what An Post is charging and seeing whether they could come in at a lower price, which ComReg will facilitate them to do. An outcome of the price increase could have a detrimental effect on An Post.

In his statement the Minister of State said a 1% reduction in mail volumes cost An Post €4 million a year, which is probably true, but I take issue with his statement that a 1% increase in pay costs An Post €4.5 million a year. The recent pay deal that was worked out with An Post staff has been introduced on a cost-neutral basis as staff gave up their entitlements to sick pay and other benefits to off-set the costs for the company. I do not believe a 1% increase in wages would have the same knock-on effect on An Post.

I have spoken about the social role An Post plays, which has not been recognised. It is a year since the Kerr report was published but there has been practically no implementation of the recommendations of the report, which would help to make An Post a sustainable company right across the country and would help to keep rural post offices open. We hear that the recommendations of the Kerr report will become part of the strategic review of An Post's business and we will have to wait for it to be completed before there is any implementation of the recommendations.

If that is included in the strategic review, we will have to see the roll out of it; therefore, that is a further delay. What we see here and what we have seen constantly is ongoing delay in actually dealing with the issues. The Kerr report could have been implemented last year and we could start to see the effects of the roll out of that at this stage. It could be helping to boost An Post, make the network more sustainable and assist the company in remaining sustainable, but we have lost that with the delay and the strategic review will be further delayed. We will be in a constant spiral, which will be almost like a death spiral for An Post, where there will be pressure to increase prices to fund it in the future. That increase in prices will reduce revenue. We are not getting any delivery of the recommendations that could help sustain the network and company and it will come to a point where the whole thing could collapse and come down like a house of cards. That is wrong. We should be taking a decision to recognise the social responsibility An Post has and the social role it plays and ensure that the price of stamps can be kept as low as is feasible to ensure that people can have a service they can continue to afford to use and the people who use that service are not subsidising the banks and utilities that are moving away from that service and are not paying an additional cost through that. The company has serious problems and we need to get a grip on them and accept the Government's and people's role in ensuring this service stays open because it is worth more than just the price of a stamp and the increase in stamp prices.

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