Royal Mail is calling for a six pence rise in the cost of UK stamps to help it survive in an increasingly competitive market.

In proposals to the postal industry’s independent regulator, Postcomm, Royal Mail has requested a rise in the price of stamps in order to stem massive losses.

Currently, Royal Mail loses six pence on each stamped letter it handles. Prices are currently 32p for first class and 23p for second class stamps.

Businesses would also lose the legal right to have franked mail delivered to every address in the UK according to the proposals.

Royal Mail wants this “universal service obligation” (USO) to apply to stamped mail only. The operator is also calling for an end to all regulatory controls on bulk business mail, such as lucrative junk mailings.

Royal Mail’s relatively high prices for bulk mailings subsidise other services, such as the 6p loss incurred on each stamped letter.

The firm believes its price controls are allowing rivals from Europe, such as Germany's Deutsche Post and Dutch operator TNT, to cherrypick the best UK business.

The price controls limit the amount it can charge rivals for access to its delivery network for bulk mail while forcing it to deliver personal and small business post at a loss.

Adam Crozier, Royal Mail's chief executive, warned of the proposals’ “urgency”.

“This is not scaremongering in any shape or form, you can see that when you look at [Royal Mail’s] financial numbers,” he said.

However, despite the reported urgency of the requested price hike, it is not clear when the prices would increase if Postcomm decides to allow the move.

Stamp prices were set by Postcomm last year until 2010, but with an option to revise the controls in April 2008. Postcomm will decide whether to exercise this option following a review later this spring.

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