Royal Mail ups stamp prices but wastes £1mln on office luxuries


The riverside building where the Royal Mail has its headquarters

Tuesday April 24,2012
By Dana Gloger, Consumer Affairs Editor

ROYAL Mail bosses are under fire for working in “luxurious” offices – only a week before crippling increases in the price of a stamp.

From Monday, the cost of sending a first-class letter will soar by 30 per cent from 46p to 60p. Second-class post will go up from 36p to 50p.

Many people will struggle to afford the prices, with pensioners particularly hard hit. Royal Mail, which is set to be privatised, blamed large financial losses.

It has seen an operating loss of £41million from its letters and parcels division as the volume of mail continues to fall.

Chief executive Moya Greene, who last year earned £777,611 in nine months, including a £142,000 bonus, benefits, pension and two free return flights to her native Canada, said postage costs would have to rise to make ends meet.

Last month the regulator Ofcom gave the group permission to set prices as high as it wanted. Now staff at Royal Mail’s headquarters in central London are accused of enjoying lavish working conditions.

It is a disgrace that while many pensioners will no longer be able to afford to send Christmas cards, staff at Royal Mail are enjoying such lavish offices.

In 2009 the company moved to a new building, Unilever House – a prime location overlooking the Thames. It then spent £1million on furniture, including £100,000 worth of Italian chairs, £15,000 of bespoke seats for executive offices and expensive walnut tables and desks. Carpets, sofas, floorboards and lights are also designed to the highest specification.

Consumer groups had hoped that some of the savings Royal Mail needed to make could be met by scaling down the luxurious facilities.

But one visitor described the offices as “opulent”, adding: “It is a disgrace that while many pensioners will no longer be able to afford to send Christmas cards, staff at Royal Mail are enjoying such lavish offices.

“The furniture and design is all of the highest possible calibre and is hugely expensive.”

Robert Oxley, of The TaxPayers’ Alliance, said: “It’s unacceptable that Royal Mail bosses have forked out so much for their own luxury at the same time as hiking prices for ordinary mail users.

“Executives need to deliver better value for money instead of ordering themselves the latest office kit at taxpayers’ expense.” Ann Robinson, director of consumer policy at added: “Consumers will be rightly furious about this. The double standards are unacceptable.

“This makes me wonder if Royal Mail understands what it is going to put the public through by severely increasing the price of stamps. It’s a disgrace, and older and vulnerable people will be hardest hit.”

Ros Altmann, of the over-50s campaign group Saga, said: “This is a company talking about cutting costs, so it is surprising that they seem to have such luxurious offices.

“It seems there was an error of judgment and consumers are paying the price. Older members of the population, who want to send a birthday or Christmas card to their grandchildren, will feel it is very unfair that they have to subsidise this furniture.”

A Royal Mail spokesman said: “Royal Mail occupies a single floor of the headquarters of another company. We moved into the offices because we secured a good deal, particularly in terms of the rent. We consolidated our presence in London three years ago by closing two offices, saving a considerable amount of money in the process.”

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