Letter monopoly could end

Competition could mean an end to a national letter rate

Plans that could see the end of the Post Office's monopoly on letter deliveries are to be put before a meeting of European Union ministers in Brussels on Friday.

The European Commission wants to see a final date set for the complete deregulation of postal systems across Europe for letters over a certain weight.

But some countries, including Britain, are concerned that deregulation will mean a decline in services, especially for rural areas.

Royal Mail has a monopoly on packages up to 350g

Postal workers' unions have previously warned that competition would mean job losses in the industry.

The EC wants post offices throughout the European Union to be forced to allow competition on all letters weighing more than 50 grams.

Most letters weigh less than this and would be exempt from the proposed competition rules.

Nevertheless, the move would be a significant erosion of the Royal Mail's monopoly on packages up to 350 grams.

There are fears that competition might damage the Royal Mail and other European postal systems causing them to cut their services to rural areas where the cost of collecting and delivering mail can outweigh the revenue generated by stamps.

'Hypocrisy'

The fear is that if competition were given free rein, customers living in the countryside could be charged more for their post.

And the current British practice of sending a letter anywhere in the country at one price, regardless of distance, could become too costly to sustain.

At Friday's meeting, the British Trade Minister Alan Johnson and several of his European colleagues will try to delay or water down the plans, which have already been rejected as too radical by the European Parliament.

But the UK Government could find itself accused of hypocrisy as Britain has pushed for deregulation across Europe in many other sectors.