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Lower standards, increase prices, flexible definition, global postal universal service, explore sustainable development

Time:4/29/2020Posted:Dongguan Guanghang International Logistics Co., Ltd.
Due to the impact of the Internet, the global postal service volume continued to decline, and some postal operators even fell into the quagmire. In the new era, where should universal postal services go? Many countries have begun to try to find a sustainable development path.
 Belgian postal supervision expert Sophie de Schrevel believes that the frequency of delivery is one of the contents of the universal service obligation reform. This is the factor that has the greatest impact on the Belgian postal universal service. To continue to provide sustainable universal service, it is necessary to reduce the frequency. Other countries have similar practices. For example, in 2017, Finland passed a law to reduce the frequency of letters and parcel delivery in large cities from 5 days per week to 3 days.
 Some other countries are unable to provide universal services as required by law. For example, the Royal Mail, as of September this year, failed to meet the service quality standards for seven consecutive quarters. Because Singapore Post failed to meet the legal delivery standards for local and international letters and registered letters in 2018, it was imposed a maximum fine of approximately $ 220,000 in its history in March this year. The general postal service requirements of Singapore are very strict. 98% to 99% of local letters must be delivered within 1 working day, and 100% delivery within 2 working days.
 The United States is also reviewing universal service. A few days ago, the United States Postal Service faced huge losses, with a total loss of $ 63 billion. According to foreign media reports, the U.S. Postal Service ’s concept of universal service is relatively vague. Last year, the US Presidential Special Task Force concluded after investigating the postal service: To achieve sustainable development of the postal service, the universal service obligation must be clearly defined. But Jennifer Bradley, an economist at the Office of the Attorney General of the United States Postal Service, said that the lack of a clear definition of universal service has benefited the United States Postal Service because it is difficult to define whether it violates the rules. She said: "A reasonable concept of universal service can be improved in terms of flexibility. For example, the availability can be the geographical area that should be covered, but it can be left loose in terms of the way it is provided, such as through the post office or other counters." USPS provides a delivery service 6 days a week.
 Compared with reducing the frequency of delivery, Bradley is more inclined to define universal service obligations as providing different services in different regions. "Traditionally, universal service is considered to provide the same service everywhere, but urban and rural areas can have differentiated services."
Belgian postal supervision expert Julien Crutzen said that the Belgian universal service regulations pointed out that every municipality must have a universal service outlet, but what kind of outlet is left with flexibility. However, Belgium also stipulates that at least one post office in each city is equipped with postal staff.
 Another aspect of universal service reform is price. In the United States, the price of a letter is the same nationwide, including in overseas territories. Therefore, the United States Postal Service needs to subsidize the delivery of letters over long distances. Other countries have begun to relax the price ceiling. For example, Ireland lifted the stamp price limit in response to the increase in universal service costs. At the end of 2016, Irish Post increased the price of standard postage stamps by 0.2 euros. Belgium ’s new postal law, which came into effect this year, allows postal services to increase postage when necessary, but prices have not yet been raised.
 How is the postal operator that first adjusted the universal service obligation now?
 New Zealand Post is the world's first major postal operator to make major adjustments to universal service. In 2015, New Zealand Post reduced the number of weekly delivery days to 3 days, which caused 400 people to be laid off but did not reverse the postal financial situation. The following year, New Zealand Post cut another 500 jobs. In July this year, the post had to increase the prices of mail and parcels to maintain development.
 For Finland Post, which began its reform in 2017, it has been in a state of anxiety for the past two years. In April this year, Finnish Post announced a reorganization plan, including at least US $ 130 million in savings over the next three years; in June this year, Finnish Post cut 100 jobs; in March next year, it will also lay off more than 100 people and close 18 Post office.
 The Royal Mail seems to be gaining in universal service reform. In 2012, the Royal Post regulatory agency Ofcom allowed Post to have the right to set prices for its main products, including first-class stamps and most commercial mail. Five years ago, Royal Mail was privatized and until now, although the volume of letters has declined, it has remained profitable.
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