Changes to Postal Tariff

Summary of Key Messages

• The cost of a local stamp is going to increase from 36p to 39p. Guernsey Post last increased its local stamp prices 3 years ago in April 2009 - this increase is the equivalent to the increase in RPI over those 3 years.

• Guernsey Post is confident that its prices remain amongst the most competitive within the UK and Europe.

• The cost of a UK stamp (Guernsey to UK) is going to increase from 47p to 53p.

• The OUR has approved Guernsey Post's decision to increase the postal tariff.

• Reasons for the increase in postal prices include the loss of LVCR, an increase in Royal Mail charges and the continued decline in standard mail volumes.

• The loss of LVCR is extremely significant to Guernsey Post. Over the last two years Guernsey Post has worked hard to reduce the dependency on Bulk Mail, however it accounts for 71% of Guernsey Post's revenue.

• Guernsey Post is able to offer competitive rates to some of its largest Bulk Mail customers to encourage their business to stay on the Island after the removal of LVCR on 1^st April 2012. The company continues to offer a Down Stream Access (DSA) service which provides its Bulk Mail customers with an alternative low cost service.

• Royal Mail continues to increase its charges to Guernsey Post. However, Guernsey Post believes that it has managed to negotiate the very best possible deal for its customers.

• Over the last two years Guernsey Post has seen a 15% drop in standard mail volumes. Mail volumes are expected to continue to decline between 25% and 40% in the next five years because more people are choosing instant, electronic forms of communication. (Source: Hooper Report on the postal sector 2010).

• Guernsey Post has increased its prices to ensure that it continues to meet its Universal Service Obligations.

• In the UK, the average household spends just 50p a week on postage. (2011 office of National Statistics data). It is hoped that this slight increase in stamp prices will not have a negative impact on customers.

Guernsey Post Standard Rates May 2012.pdf

Guernsey Post Business Rates May 2012.pdf

Guernsey Post Bulk Rates May 2012.pdf