The Royal Mail says its recovery is being jeopardised by new regulations even though it has been allowed to put up the price of stamps.

It will just make my job, which was difficult, almost impossible

Allan Leighton Consignia chairman

The regulator Postcomm has agreed to the Royal Mail's request for first and second class stamps to be increased by a penny.

But it has attached detailed price controls for other mail deliveries.

Allan Leighton, the chairman of the parent company Consignia, said the regulator was giving with one hand and taking back with the other.

"These are shocking proposals. The regulator is trying to put us in a straitjacket," he said.

'Breathing space'

Mr Leighton told BBC Radio 5 Live that the price controls would cost the Royal Mail �500m ($785m) over the next three years.

He warned that it would fatally damage the chances of recovery.

"It will just make my job, which was difficult, almost impossible," he said.

Postcomm rejected the criticism.

Its chairman Graham Corbett said he was aiming to give Consignia a breathing space while protecting customers from unacceptable price increases.

Compensation for customers

Under Postcomm's plans first and second class stamps would go up by 1 penny to 20p and 28p next April. And the prices would be frozen until 2006.

The regulator has also laid out plans for paying compensation if mail is delivered late.

Customers would get up to �14 per item for late mail and up to �27 for lost or damaged post.

Mr Leighton said he had no problem with the compensation proposals, only with the price controls.

Urgent talks

"We've always accepted that our prices should be subject to regulatory control but just when we need a degree of flexibility, we're being invited to put ourselves in a headlock

Consignia is planning to hold urgent talks with Postcomm about the proposals.

"We would be like turkeys voting for Christmas if we accepted this pricing package," Mr Leighton said.

Last year the Royal Mail made a loss of �1.1bn.