MaltaPost raises tariffs despite €796,000 profit

Despite registering a €796,000 profit in the first half of their financial year from 1 October 2011 to 31 March 2012, MaltaPost has announced a substantial increase in its postal tariffs.

Last week, MaltaPost revised its postal tariffs upwards, insisting that throughout 2012 it was negatively impacted by changes in the framework.

Postal rates were raised substantially on Monday, with further increases set to follow in April 2013.

Domestic registered mail now costs 90c, up from 49c while domestic bulk letter mail was raised by 5c for letters weighing less then 50 grams, 4c for letters weighing between 50 grams and 100 grams and 11c for letters up to 2kg.

A spokesperson for the company said that the hikes will not affect all customers as only the bulk postal service, "mainly used by businesses" was increased.

In a decision published on 8 November, the Malta Communications Authority approved the new tariffs requested by MaltaPost.

The company justified the hike by saying that "for a number of years, various services such as the domestic letter mail and mail registration, have recorded systematic losses."

In accepting the request for increases, the Malta Communications Authority noted that "the impact of postal tariff changes on household expenditure is expected to be minimal" and that the proposed changes were still affordable to businesses."

International registered mail increased to €2.25 from €1.40 while advice of delivery on international registered mail now stands at €1.75, an increase of €1.14.

According to the service provider, the changes were set by the Universal Postal Union who established inter-operator fees over international mail.

In its statement on Friday, MaltaPost said: "This makes it unsustainable for MaltaPost to keep providing the current level of service. Against this backdrop and MaltaPost's commitment to keep providing an efficient, high-quality service MaltaPost submitted to the MCA a request for a number of tariff increases."

"The revised tariffs shall still remain among the lowest in Europe," MaltaPost added.

In September, MaltaToday had revealed that MaltaPost plc will be retaining their monopoly despite an impending liberalisation of the market in January 2013, as required by EU legislation.

The Malta Communications Authority had told MaltaToday that it intends to renew MaltaPost's designation as the company responsible for the daily collection and delivery of postal items, which is enshrined in its Universal Service Obligations, without issuing an international tender.

Formerly government-owned before the liberalisation of the postal department, MaltaPost is now a fully privatized company owned by Lombard Bank.

The MCA will not be issuing a tender as has happened in previous liberalisations of government services such as public transport or the public lotto. In both case the tender was awarded to foreign bidders, Arriva and Maltco respectively.

The collection and delivery of postal items on a daily basis is one of the universal obligations performed by MaltaPost in its role Malta's designated Universal Service Provider (USP).

The assignment of universal service obligations (USOs), unlike that of other postal services, is carried out by legal notice on the basis of advice by the MCA, and this will remain the case up until the market is fully liberalised in January 2013.