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PostNL is granted 7.1 percent additional headroom to increase the tariffs of the basic set for 2018

24-08-2017

Dutch postal operator PostNL is allowed to raise the tariffs of the basic set of postal services for 2018. This set is also called the universal service obligation (USO). The additional headroom is 7.1 percent. This has been determined by the Netherlands Authority for Consumers and Markets (ACM) on the basis of statutory rules. The aim of these rules is that consumers and businesses do not pay too much for mail delivery services, while PostNL is able to provide the basic set of postal services in a cost-effective way. Henk Don, Member of the Board of ACM, explains: “We must take the increasingly empty collection boxes into account. The fewer letters PostNL delivers, the more the tariffs are allowed to rise.”&

PostNL to submit a tariff proposal

Now that ACM has determined the tariff headroom, PostNL is able to submit a tariff proposal for 2018. ACM then assesses whether these tariffs comply with the statutory requirements. Later this year, PostNL will determine the tariffs for, for example, stamps and registered mail in 2018.

PostNL has sole responsibility for a basic set of postal services

The law imposes rules on PostNL because it is the only postal operator in the Netherlands that is responsible for the basic set of postal services (the universal service obligation). This means that PostNL is obliged to collect and deliver individual letters and parcels five days a week in the whole country. With the turnover from individual letters and parcels, PostNL is only allowed to recoup the costs plus a reasonable level of return. ACM assesses this every year when determining the tariff headroom and the tariffs. In July 2017, the Dutch Ministry of Economic Affairs published a study about the Dutch postal market. This also contains scenarios for the future structure of the basic set of postal services.

For many years now, PostNL has generated profits on the basic set

Over the past few years, PostNL has consistently generated profits on the basic set. In 2016, the positive return amounted to 6.3 percent. This is below the maximum return that PostNL is allowed to generate according to the legislature.

Business senders and consumers continue to send less mail

ACM recently published the Postal and Parcel Markets Scan. This has revealed that consumers and business senders send less next-day delivery mail: less mail of consumers via the basic set and less mail of business senders. In 2016, business senders sent 2.6 billion letters, magazines, and other mailpieces, which is 10 percent less than in 2015. In the same year, consumers sent 196 million mailpieces such as letters and cards, an average of 12 per person. In 2015, that average was still 13. PostNL raised the price of stamps in 2016 from EUR 0.73 to EUR 0.78. The turnover from mail delivery declined, but was compensated by the increase in turnover from parcel delivery. The parcel delivery market grows from year to year, which is especially caused by the surge in online shopping.