STAMP prices are to rise further to pay for Royal Mail’s pension black hole after the postal regulator bowed to last-minute pressure from the group.

Postcomm said yesterday that Royal Mail could add an extra penny to stamp prices to help with an expected ballooning in its deficit to £6 billion. Previously, the regulator had set out caps on price increases, which it had said were final.

The latest move means that the price of a first class stamp could rise from 30p to 37p within four years. Next month it will increase to 32p in the first phase of increases if Royal Mail accepts the pricing programme.

The postal group is expected to decide in the next few days whether it will agree to the scheme or force an inquiry by the Competition Commission.

Gregor MacGregor, chief executive of the consumers’ group Postwatch, said that Royal Mail had “got away with murder” because of the latest increase and that customers faced a double whammy of price increases.

“There is no contribution from the shareholder (the Government), no contribution from the management and no contribution from the staff. It is all falling on the customer,” he said Royal Mail’s pension deficit is £4.5 billion but this is expected to rise to about £6 billion after an actuarial review which is to start soon.

Nigel Stapleton, chairman of Postcomm, said that the latest proposals would “enable Royal Mail to invest in the business, meet its obligations to the pension fund and build on these achievements going forwards”.

Royal Mail said that it noted the broad terms of Postcomm’s changes.

A spokesman said: “We are now working with Postcomm over the next few days to understand the details of those proposals, which will enable us to decide as quickly as possible whether to accept or reject the price control, and give our customers the certainty they need.”

Royal Mail is waiting on a decision from the Government over whether it can give the group £2 billion to fund new investment.

Some industry insiders believe that it has been prolonging the negotiations with Postcomm in order to get a better indication from the Government. The first phase of stamp price increases, if they go ahead, is due on April 3.

It is thought that the latest concession from Postcomm is worth about £200 million to Royal Mail in extra revenues.

In common with many large organisations, Royal Mail has seen its pension fund hit by the downturn in the stock market. Some 70 per cent of the fund’s assets of £17 billion is invested in equities.

Times Recommends

• Minister in talks with Saudis to protect creditors
• Premier Inn hits back in £29-a-room row
• Bankers hit back at 'populist' bonus supertax