Agency leaves questions over Iceland Post subsidies unanswered

Iceland’s Regional Development Institute has not said whether it revised calculations of state compensation to Iceland Post for 2020 and 2021, despite repeated questions from mbl.is. The institute oversees postal services.

The institute had included caveats in its calculations for those years but dropped them in 2023 without explanation. It has not clarified whether the amounts previously set remain unchanged or why the caveats were removed.

For 2022, the institute deducted 181.2 million Icelandic krónur under a “reassessment” heading. This included 158.1 million krónur for a reassessment of cost allocation and 23.2 million krónur for estimated savings from reducing the number of delivery days.

The institute confirmed to mbl.is that the 158.1 million krónur deduction was calculated entirely on the basis of 2022 costs, and did not correct the calculations for 2020 or 2021. Its 2023 decision said the earlier caveats had been resolved, but the institute has referred mbl.is to its original decisions rather than answering whether the calculations were later revised.

mbl.is also asked how net universal service costs were divided among individual service categories after reassessment. The institute has not said whether updated figures are available. It has denied access to supporting calculation documents, classifying them as working papers exempt from public access.

State compensation is intended to cover Iceland Post’s net costs for statutory postal services that are not financially self-sustaining. Because the company also operates in competitive markets, costs shared between its activities must be allocated correctly.

The cost model used by Iceland Post is not public, making it difficult for outside parties to verify the allocation or determine whether the payments cover only universal service costs. The EFTA Surveillance Authority is examining whether Iceland Post received unlawful state support.