UK Mail, the Business Post subsidiary, has won a GBP 12 million contract to deliver pensionstatements and winter fuel payment notifications for the UK government, beating off competition
from the state-owned postal operator Royal Mail.The award will come as a relief to Business Post, which last month heard it would lose itsGBP 16 million UK parcels distribution contract with FedEx following the latter’s acquisition ofrival ANC. The company’s shares gained more than 4% yesterday on announcement of the new contract.
But the handing of the work to UK Mail was yesterday criticised by the Communication Workers’Union, which represents Royal Mail employees.
CWU general secretary Billy Hayes called the decision “rash” at a time when the Department ofTrade and Industry was conducting a review of the national postal service and called on othergovernment departments not to follow suit by engaging private companies to carry their mail.
Britain’s postal market has been open to competition since the beginning of 2006 and it isestimated that around one in eight letters is now handled by Royal Mail’s rivals.
