Second class mail deliveries are to be slashed from six to just three days a week from later this month in one of the biggest cutbacks in postal services in the 500 year history of the Royal Mail.
Regulator Ofcom said today it has given the go ahead to proposals to allow Royal Mail to deliver second class letters on alternate weekdays from Monday to Friday with no Saturday delivery. Delivery will still have to be made within three days of collection and the first class post is not affect. The changes will come into effect on 28 July.
Ofcom said “urgent reform” was needed to allow Royal Mail to fulfil its universal service obligation. It is estimated the changes will save Royal Mail between £250 million and £425 million a year.
The regulator also announced changes to delivery targets. For First Class mail the target for next day delivery is cut from from 93% to 90% while for Second Class mail it is cut from 98.5% to 95% delivered within three days.
There is also a new backstop target of 99% of mail being delivered no more than two days late.
Royal Mail’s parent company International Distribution Services was sold to Czech billionaire in a £3.6 billion deal earlier this year.
Natalie Black, Ofcom’s Group Director for Networks and Communications, said: “These changes are in the best interests of consumers and businesses, as urgent reform of the postal service is necessary to give it the best chance of survival.
“But changing Royal Mail’s obligations alone won’t guarantee a better service – the company now has to play its part and implement this effectively. We’ll be making sure Royal Mail is clear with its customers about what’s happening, and passes the benefits of these changes on to them.
“As part of this process, we’ve been listening to concerns about increases in stamp prices. So we’ve launched a review of affordability and plan to publicly consult on this next year.”
Martin Seidenberg, group chief executive officer, International Distribution Services said: “We welcome today’s announcement from Ofcom. It is good news for customers across the UK as it supports the delivery of a reliable, efficient and financially sustainable Universal Service. It follows extensive consultation with thousands of people and businesses to ensure that the postal service better reflects their needs and the realities of how customers send and receive mail today.”
Since 2012 the number of letters delivered each year by Royal Mail has more than halved from 14.3 billion to 6.6 billion. Since 2008, Royal Mail’s revenues from letters have fallen from £6.9 billion to £3.7 billion. In 2023/24, Royal Mail made a loss of £348 million, and in 2022/23 it made a loss of £419 million.
Universal Service Obligation, Tom MacInnes, director of policy at Citizens Advice, said: “Royal Mail has a woeful track record of failing to meet delivery targets, all the while ramping up postage costs. Today, Ofcom missed a major opportunity to bring about meaningful change.
“Pushing ahead with plans to slash services and relax delivery targets in the name of savings won’t automatically make letter deliveries more reliable or improve standards.
“While Ofcom says it recognises the importance of affordability and reliability for consumers, we need to see those words backed by action, forcing Royal Mail to do what it should've been doing all along - giving paying customers a service that delivers.”
