Amanda Jones – MDA2 update

As part of our weekly Postmaster email, Amanda Jones, Retail and Franchise Network Director has been sharing regular updates on the consultations. A key update was sent on Friday 21 May with the following news:

We understand many of you would like more time to understand what a value-based remuneration approach means for your business and so there are a couple of updates I would like to share with you:.

Implementation date
Our original proposal was to implement a new mails remuneration structure from January 2022 remuneration (December 2021 trading).

We understand the new Mails Distribution Agreement (MDA2) is a big change and it will take time to understand, because customer behaviour and the mails marketplace are evolving.

We have therefore decided to extend the implementation date by a further three months so that the new rate structure starts from April 2022 remuneration (March trading).

Moving the date of implementation will give us longer to understand the changing customer patterns as a result of Covid-19, and to review and share the actual comparison of value and volume for your branch or branches. 

Remuneration Top Ups
Under our original proposal we had planned to calculate and provide ‘top up’ payments (referred to as ‘Implementation Benefit Payments) based on two, three-month trading periods (June to August trading and then September to November trading).

We will continue with that arrangement and those payments will be made with September and December’s remuneration this year.

We will extend this arrangement for a further three months using the trading period from December 2021 to February 2022 and make the final payment with March 2022 remuneration.

Interim Tariff Payments
Under our original proposal we planned to pay interim tariff payments up to December remuneration (November trading). This is so you see the benefit of Royal Mail’s customer price rises until the new arrangements are introduced.

We’ll also extend these payments by a further three months up to March 2022 remuneration (February trading).

This means that all Postmasters will see increases to their Royal Mail remuneration (assuming sales levels are maintained) for this full financial year (up to and including March 2022 remuneration).

Those increases are a result of us passing on the full tariff increased benefit via the interim monthly payments, and additionally passing on the remuneration for those that would have gained had we implemented the proposal at the earlier date.