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Jersey Competition Regulatory Authority: proposal to grant a Postal Operator’s licence.

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STATES OF JERSEY

JERSEY COMPETITION REGULATORY AUTHORITY: PROPOSAL TO GRANT A POSTAL OPERATOR'S LICENCE

Lodged au Greffe on 12th April 2010 by Deputy G.P. Southern of St. Helier

STATES GREFFE

2010   Price code: A  P.44

PROPOSITION

THE STATES are asked to decide whether they are of opinion

to  request  the  Minister  for  Economic  Development  to  request  the  Jersey Competition  Regulatory  Authority  (JCRA)  to  extend  the  period  of consultation over the granting of postal licences to Citipost and HubEurope so that members may be fully informed of the consequences of such action by the JCRA.

DEPUTY G.P. SOUTHERN OF ST. HELIER

REPORT

On  Wednesday  31st  March  2010  the  Jersey  Competition  Regulatory  Authority (JCRA) placed an advert in the JEP (see Appendix) of its proposal to grant a Postal Operator's licence to Citipost and HubEurope to convey large letters and packets, which  includes  CD  and  DVD  fulfilment  post.  The  closing  date  for  comment  is midnight 30th April 2010.

Jersey Post's  managing director has accused the JCRA of "failing in its duty to properly assess the impact on the traditional postal business." Mr. Carr stated that the decision to open the whole of the bulk business mailings market could result in substantial cuts to future services including a reduction of deliveries to every other day and the existing Post Office network being halved.

Despite being assessed in 2006 by the JCRA as an efficient operator, and recently agreeing  a  4-year  modernisation  deal  with  the  Communication  Workers'  Union (CWU) which included the loss of 80 jobs, the Post Office see this as an "attack" on the only profitable part of the business leaving losses to be picked up by Jersey Post or the taxpayer.

The CWU agrees that the long-term viability of Jersey Post is seriously threatened by the introduction of competition to this market. They state that they "will not sit back and watch the decimation of this very valuable social service carved up and destroyed through the introduction of phoney competition designed for the benefit of a few at the expense of the many". They are calling for urgent talks with all stakeholders including States members.

It is my opinion that such a radical move cannot just be allowed to proceed in such a timescale without full consideration by the Assembly of the potential impact on the infrastructure of the island.

There are no manpower and financial implications to this proposition.

Page - 3

P.44/2010

APPENDIX