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Last Updated: Thursday, 9 August 2007, 17:11 GMT 18:11 UK
Post strike suspended for talks
Postal workers on strike
Workers have already embarked on strikes earlier this summer
A postal strike in the UK set to start on Thursday has been called off to enable talks to go ahead, the Communication Workers Union has said.

Postal workers had been set to strike for 24 hours from 1900 BST.

The strike was put on hold after meetings between Royal Mail chairman Allan Leighton and heads of the CWU.

CWU members have already been striking after rejecting a 2.5% pay deal and modernisation plans, which the union says could threaten 40,000 jobs.

Bad finances

Talks to resolve the dispute are now set to go ahead, with the aim of reaching a deal by 4 September.

As well as the planned walk-out by workers in mail centres and airports, different groups of employees, including delivery staff, had also been set to take action.

Among those present at Thursday's meeting were Royal Mail's chief executive Adam Crozier and CWU leaders Billy Hayes and Dave Ward.

The clash between the Royal Mail and union workers has been ongoing for many months with Royal Mail saying workers had been ignoring the "harsh reality" of an open market.

The decision to suspend the strike came on the same day that Postcomm, the independent regulator for postal services, warned Royal Mail of an urgent need to tackle its financial problems.

Publishing an interim review of Royal Mail, Postcomm chairman Nigel Stapleton said: "Postcomm is giving Royal Mail all the help it can to tackle its deteriorating financial situation.

"The ball is now firmly in Royal Mail's court to address urgently its very high cost base."

Postcomm said it would help Royal Mail by giving it "greater pricing flexibility from April 2008 to align the prices of some loss-making products more closely with costs".

But it said that Royal Mail could not blame its financial problems on greater competition in the bulk mail and business delivery sectors.

Its rivals' better performance, Postcomm said, was due to "greater efficiency and customer focus".

For every piece of stamped mail delivered, Royal Mail says it loses 6 pence.

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