Minister for Communications Denis Naughten is set to as Cabinet for a major increase in postal charges and a repeal of the postal price cap – put in place by the regulator – for mail services that are not subject to competition.
Naughten wants a relaxing of current regulations so that An Post can adjust prices. The postal price cap is currently in place until June 2019.
An Post made overall profits of €8.6m in 2015, up €5m on the previous year, but it suffered losses of more than €32m with respect of its so-called universal service obligation to deliver post to all homes and business premises in the country, regardless of location.
An Post, which has a new chief executive in former TV3 boss David McRedmond, has argued that it can’t continue to subsidise these losses from other business activities and is looking for significant price increases. There is also concern for the maintenance of up to 9,000 jobs in the sector, with employee numbers already down significantly in recent years.
The price of a standard stamp is 72c in Ireland, while the average across Europe is more than 90c.
Moving in line with the Continent would involve a 25% jump, so it's possible An Post will signal a series of staggered annual increases over a short period to get to these levels.
Sources said he wants to repeal the 'postal price cap' currently in place until June 2019, although price rises will still be subject to certain conditions.
These include the continuation of the Universal Service Obligation, which ensures delivery in every part of the country.
In September, former An Post chief Donal Connell wrote to ComReg calling for a review of price caps. His letter stated:
"I cannot over emphasise the importance and urgency of this."