The performance of An Post in delivering mail has deteriorated, with only 74 per cent of postal items delivered by the next working day, a new survey has found.

The survey by the regulator ComReg relates to the third quarter of 2005. The figures for this period were 4 per cent down on the previous quarter. ComReg last night expressed dissatisfaction with the results and pointed out that its target for next-day delivery was 94 per cent.

It also pointed to an especially poor performance in the southern region of An Post's network, which it said appeared to be the result of operational changes.

An Post strongly contested the results. Under chief executive Donal Curtin, the company has for a long time rejected the methods used by ComReg for measuring its performance.

"The third quarter of 2005 was a period of considerable operational change and industrial relations difficulty in An Post. The impact on service standards due to changes in the method and location of mails processing in the south of the country is well known. An Post is satisfied that service quality has improved significantly since then," said a statement.

ComReg pointed out that the third quarter should be An Post's best performing period. Mail volumes are far higher in the run-up to Christmas for instance. The regulator highlighted particular problems with the delivery of mail originating outside Dublin. For example it said only 69 per cent of mail generated outside the capital reached the city the next day.

ComReg said the postal market was facing further liberalisation in 2006 and full market opening was to take place in 2009. It said whatever happened during this period, next day delivery was vital. "While certain aspects of the postal market may provide new challenges and opportunities for An Post, quality of service will still remain a key issue for consumers," said a foreword to the survey by commissioner Mike Byrne.

However, An Post for its part said changes were taking place at the company. "A new, improved way of working, as recently agreed with the Communications Workers Union, will enable An Post and its staff to deliver better quality of service and a much broader, modern range of products and services to customers in 2006," said a spokeswoman.

Meanwhile a board meeting of An Post took place yesterday and directors discussed the recent decision by ComReg to turn down its application for a price increase. A statement issued afterward said the board was deeply concerned about the financial implications of the decision and the ramifications for the firm.