Two-tier postal service proposed

The postal regulator, ComReg, has floated the idea of An Post offering a two-tier system for the delivery of standard mail.

In a document issued yesterday, the regulator said An Post's current performance on next-day delivery remained below acceptable standards and it was time to consider what services the company should be offering.

It pointed out that in half of all EU states, customers were able to choose between a priority service with a next-day delivery target and a slower, but cheaper, non-priority service.

"Where customers have a choice and there is a notable differential in price, about 70 per cent of mail is posted at the cheaper/slower non-priority postage rates," the regulator said.

The comments are included in a document which looks at what services An Post should be offering as a universal service provider. ComReg has published the document as part of a major consultation process.

"In a single-tier service, it is only possible to meet the service requirement of all customers by providing the quicker priority service. However, this means some customers have to pay for a higher-level service than they require," the document states.

It suggests that demand for a slower, but less expensive service would be "significant". It then asks whether the single-tiered system is sustainable any more or acceptable. However, the document acknowledges the amount of work needed to separate out mail might not be justified in a relatively small market like Ireland.

The document points out that businesses which engage in bulk mailing have the choice between priority and non-priority services.

However firms without access to a franking machine, or those companies which post less than 500 items at any one time do not.