The price of a first-class UK stamp is scheduled to rise by 15p in October – the third increase in 18 months – in a fresh blow to consumers and businesses who rely on the postal service.
The increase will mean that from 2 October a first-class stamp will cost £1.25 – 47% more than in March last year.
Royal Mail said the price rise was due to “increasing cost pressures, the challenging economic environment, and the lack of reform of the universal service obligation (USO)”.
It is lobbying for changes to the USO, which requires it to deliver letters to the UK’s 32m addresses six days a week on a one-price-goes-anywhere basis. On Tuesday, the communications watchdog, Ofcom, said it was beginning a review of the USO and looking at whether services “might need to evolve to better reflect the changing needs of postal users”.
Announcing October’s price increase, Royal Mail said the USO was in need of urgent reform because of the dwindling number of letters being sent.
In 2004-05 Royal Mail handled 20bn letters a year but by 2022-23 the figure had fallen to 7bn, it said. Meanwhile, the number of addresses to be delivered to has increased by 4m.
Royal Mail said the cost of a second-class stamp would remain at 75p and was well below the European median of 94p. It said the imminent rise in the price of sending a letter first class would bring it in line with the European median.
Nick Landon, the chief commercial officer at Royal Mail, said: “We understand the economic challenges that many of our customers are currently facing and have considered the price changes very carefully in light of the significant decline in letter volumes.
“Letter volumes have reduced dramatically over recent years, down more than 60% from their peak in 2004-05 and 30% since the pandemic. It is vital that the universal service adapts to reflect this new reality.”
