Share |

Saturday 10 July 2010

Is postal tariff hike justified?

Pos Malaysia has pushed through a hefty tariff hike from 1 July, but is such a sharp rise justified?
The standard mail (up to 20g) tariff shoots up from 30 sen to 60 sen while the rate for mail up to 50g soars from 40 sen to 70 sen.
More and more folks in urban areas now rely on email and social networking tools; so this move will hurt the rural folks and others without internet access the most. Snail mail accounts for 62 per cent of Pos Malaysia’s revenue.
As one outraged reader wrote to The Star:
The new tariff is absolutely ridi­culous as the quantum of increase is simply preposterous. Calculations show that the increase in tariff ranges from a low of 20% to a high of 100%. Of all the categories, six of them have increased by between 50% and 70%, while seven others have gone up by over 70%. In fact, three of them are up by 100%.
The thing is, does Pos Malaysia really need to raise its tariffs now?
For the year ended 31 December 2009, Pos Malaysia posted a profit before tax of RRM109 million up from a loss before tax of RM0.5 million the previous year.
Its profit from operating activities in 2009 was RM82 million (on the back of turnover of RM902 million), only slightly down from its operating profit of RM86 million the previous year (turnover RM922 million).
Its current assets exceeded current liabilities while its ‘cash and cash equivalents’ stood at RM318 million.
This doesn’t look like a company in desperate need of a sharp increase in tariffs. What do you think?
The substantial shareholders of Pos Malaysia as at 15 March 2010 are:
1. Khazanah Nasional Berhad 32.21%
2. Employees Provident Fund Board 9.59%
3. Permodalan Nasional Berhad 8.45%
4. Amanahraya Trustees Berhad Skim Amanah Saham Bumiputera 8.18%
5. Aberdeen Asset Management PLC and its subsidiaries 7.87% (Who does this belong to?)
Could the tariff hikes be a precursor to the government divesting or reducing its stake as suggested earlier? New reports had suggested that 11 parties are interested in bidding for Khazanah’s stake and local parties may tie up with foreign firms to bid.
If the government is divesting some of its stake to private interests, shouldn’t it maintain the previous tariff structure and ask those private interests to prove that it can run Pos Malaysia more efficiently?
Who is subsidising whom now?

No comments: