Royal Mail boss Moya Greene to be quizzed by MPs over plans to raise stamp prices by 50 per cent

17th February 2012

The head of the Royal Mail will have to defend her controversial plans to increase the price of stamps at a public Parliamentary hearing later this month.

MPs have ordered a probe into Royal Mail's plans to raise the price of second class stamps by 50 per cent from April. The price of first class stamps could rise by far more.

MPs on the Business, Innovation and Skills committee announced a new inquiry into “stamp price regulation” and plans to overhaul the post office network.

The first public evidence session will be on 21 February, when the MPs will take oral evidence from postal regulator Ofcom and Consumer Focus, the watchdog.

Moya Greene, Royal Mail’s chief executive, is likely to be called to give evidence to the committee on February 28.

A spokesman for the committee said that the investigation would "examine whether the most basic postal service is becoming too expensive”.

Royal Mail set out plans last month to increase the price of second class stamps by 53 per cent, from 36p to 55p. There would be no limit on the price of a first class stamp, which currently costs 46p.

Ofcom, the postal regulator, is now considering Royal Mail’s request, and will decide whether to give it green light in a few weeks’ time.

When the likely increase was announced, Adrian Bailey MP, the chairman of the House of Commons’ Business, Innovation and Skills committee, told The Daily Telegraph: “I am absolutely astonished that a 50 per cent increase is being proposed in a market that is declining.

“It could accelerate this and bring into question the future viability of this service with its potential impacts on post office as well.”

A Royal Mail spokesman said last night: “It is never easy to ask for a price rise but they are needed to ensure the sustainability of the universal service.”

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