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Royal Mail

I am afraid that I must keep going. Much of the profit last year came from the European parcels business, and indeed the Post Office's share of the profit came from the Government's subsidy. The letters business is making a very small profit, against a turnover of some £7 billion, and when the chief executive of Royal Mail Group announced those results recently, he said:"““We must step up the pace at which we are transforming Royal Mail otherwise, as the recent Hooper report made clear, we face decline””." Hooper suggested that there would be a small profit this year, but that the company would have a significant negative cash flow every year for the next four years. Royal Mail has told the Government that volumes are continuing to fall—even faster than in the past two years—and that that will have an adverse impact on future revenues and profits. Without further action, the position will be compounded by any steps that the trustees might need to take to tackle the pension deficit, which could double when it is revalued.