Anthony Hilton: Enough nostalgia — Royal Mail must adapt or die

Resistance to new plans for postal service privatisation is based on a lost world of letters and Postman Pat

Carry on, constable: the red pillar box has become a symbol of all that is British

Updated: 15:08, 11 July 2013

How many months is it since you saw someone sitting on a bus or a train and reading a letter? Not a greeting card, not a holiday postcard, not a piece of junk mail or a bill from the electricity company, but a proper letter, written longhand in ink? For that matter, when was the last time you wrote one?

Now think about emails and texts. How many minutes it is since you saw someone checking his or her smartphone or sending a text? How many minutes since you did yourself?

Royal Mail has to cope every day with the reality that, these days, people are more likely to know the cost of a text than the cost of a second-class stamp. People do not write letters any more. Royal Mail’s core business is in long- term decline. Volumes have dropped by a quarter in seven years and will most likely carry on at that pace for the next seven. Social attitudes have changed too. Most people today do not tingle with anticipation waiting for the post to arrive — not like they used to in the days of warm beer and Hovis adverts.

Why would they? These days it is either junk mail to go straight in the bin, a utility bill to create a hole in the bank account or something nasty from the taxman. A few giant companies — big advertisers, those utilities again and various government departments — easily make up between half and three- quarters of the mail that comes through the door every day. Perhaps some people still look forward to its arrival but then some people look forward to a visit to the dentist.

If that is all Royal Mail had to live on it really would be doomed. But the astonishing thing is that last year it made a profit — something over £400 million — and should do better still this year. It helped greatly that responsibility for two loss-making nasties — the liability for its underfunded pension scheme and the costs of local post offices and sub-post offices — have been separated out and passed back to the Government. But the real reason for Royal Mail’s growth, and the cause of such optimism among its senior management, is that no one does more online shopping than the Brits, and the Royal Mail delivers more of that shopping than anyone else. The Royal Mail has a fairy godmother and her name is Amazon.

So when the Business Secretary Vince Cable stood up in the Commons yesterday to explain how the Government planned to privatise Royal Mail, probably this autumn, what he was actually talking about was a parcel delivery company whose many rivals — such as City Link, DHL or UPS — are already in the private sector. So why should anyone care?

Bizarrely, they do care — and in the case of the Conservative Bow Group, which yesterday issued a pamphlet attacking the plan, they care very much. The nub of their concerns is that a privatised and profit-seeking Royal Mail would somehow try to dilute what is called the universal service obligation, which is its legal requirement to deliver mail six days a week to every house in the country for the cost of a stamp.

The Government denies this, the Royal Mail denies this, but the likes of Bow Group chairman Ben Harris-Quinney don’t trust them. His argument (when not scaremongering with the suggestion that advertisements for Wonga.com will replace the Queen’s head on postage stamps) draws heavily on imagery of red pillar boxes, winding country lanes and an England of Miss Marple. He suggests that the daily postal delivery is the only thing which is holding the countryside — if not the country — together. And he thinks that whatever promises are made today, a few years down the line a privatised Royal Mail will find some way to wriggle out of its daily postal delivery, or demand a government subsidy for continuing it.

Perhaps it will — no one can predict the future. But Royal Mail chairman Don Bryden has been heard to say it is more likely things will go the other way — that the six-day delivery might even become seven, because online shoppers want their parcels immediately and get frustrated when their Saturday shop does not arrive until Monday. That was not a forecast, nor a promise, but simply a reflection on the fact that if the customer demands something, a sensible business looks at how it might respond.

That, however, is a rational response to what is largely an emotional argument. The Bow Group lament will strike a chord with a lot of people. The general distrust of government, big business and the City plays to a belief that privatisations invariably mean rising prices and poorer service — and that Royal Mail would be no exception. On the one hand, people might well accept that the company needs a stock market listing and the ability to raise huge sums of money for re-equipment and modernisation to make the most of its chance to become the parcel deliverer of choice. But they might wonder whether privatisation is a price worth paying.

It is not a real choice, though. The alternative to privatisation is not a continuation of Royal Mail in a land of village cricket and warm beer. Darwin taught us that when times change, the choice is to adapt, as Royal Mail is trying to do, or doggedly stay the same and die. Privatisation will not solve all Royal Mail’s problems. But it will point it in the right direction.


Don't Miss
Cara and Kate team up for Burberry

Cara and Kate

Cara Delevingne teams up with Kate Moss for Burberry campaign
Hogging the limelight: Gervais gets a selfie with Miss Piggy

Hogging the limelight

Ricky Gervais gets a selfie with Miss Piggy
Fay Maschler reviews Marani

Restaurant review

Fay Maschler reviews Marani
Pictures: Party people - the stars out in London

Party people

The stars out in London
Fay Maschler reviews Marani

Restaurant review

Fay Maschler reviews Marani

Ashley Jensen


Worst dressed

Who dressed like a dog's dinner this week?
Bieber rolls his eyes and refuses to answer lawyers questions

Bieber the brat

Bieber's latest video … arguing with lawyer in paparazzo attack case

David Peckham

Feeling peckish? KFC-style buckets are all the rage

Feeling peckish?

KFC-style buckets are the new plates at London restaurants