Thank you to everyone who has contacted me about protecting our postal service.
Royal Mail is an iconic national institution. As I understand it, the Government engaged with EP Group and the Communication Workers Union (CWU) throughout the process of Royal Mail’s ownership transition. The Deed of Undertaking agreed with the new owner includes a commitment from EP Group that they will continue to recognise the unions and abide by the future terms of legally binding agreements they make with them. I am assured that the Government will continue to monitor compliance with these undertakings and maintain dialogue with all parties to ensure that agreed protections and principles are upheld.
On reform of the Universal Service Obligation (USO), the agreement between the Government and EP Group does not give the Government a role in the operational decisions of the business, which remains a private entity. However, I understand that Royal Mail and the CWU agreed to run pilots in selected offices to design, test and review the operation of the proposed delivery model in response to the USO changes announced by Ofcom last July.
Implementation of those changes are for Royal Mail’s management and the new owner in consultation with its unions. I understand that the Government is aware that discussions are ongoing and encourages all parties to continue their constructive engagement to agree the best approach to reform that supports workers, delivers for customers and secures the long-term financial sustainability of the universal postal service.
On Ofcom, the effectiveness of the working relationship between Ofcom and Royal Mail is fundamental to maintaining a sustainable and reliable universal postal service. I know that ministers and officials have regular discussions with Royal Mail and with Ofcom, as the independent regulator for the postal sector.
On protecting postal services more broadly, I welcome the Government’s commitment to ensuring that the retail side of the network is put on a path to a strong and sustainable future. For the first time in 15 years, a comprehensive review of the Post Office was launched last year, giving postmasters and the public the opportunity to shape the future of the organisation. The Government will invest over £500 million during this Parliament to ensure financial stability – including up to £136 million in the 2025/26 financial year alone to invest in new technology and replace Horizon. Ministers have also announced plans to award a new subsidy package of up to £118 million to fund the Post Office’s Transformation Plan and further investment to improve the network.