THE Royal Mail has been given the green light to make a huge change to its deliveries this month in a blow to customers.
The postal service has been told it can deliver second-class letters every other weekday and not on Saturdays to help cut costs, the industry regulator has said.
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Ofcom said that a reform to the Universal Service Obligation (USO) was needed as people are sending fewer letters each year.
As a result stamp prices keep rising and the cost of delivering letters goes up.
Meanwhile, Royal Mail profits have dwindled and the company has lost hundreds of millions of pounds.
Under the current one-price-goes-everywhere USO, it means Royal Mail has to deliver post six days a week, from Monday to Saturday.
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It also must deliver parcels on five days – from Monday to Friday.
The decision comes as part of proposals laid out by industry regulator Ofcom.
Ofcom said Royal Mail should continue to deliver first-class letters six days a week.
But from July 28 Royal Mail will deliver second-class letters on alternate weekdays.
Letters will still be delivered within three working days of collection – Monday to Friday.
Ofcom said the move follows a consultation with thousands of people and organisations – including consumer groups, unions, small businesses, public services, Royal Mail and the wider postal industry.
Royal Mail bought by Czech billionaire Daniel Kretinsky for £3.57bn after parent firm agrees to takeover
Natalie Black, Ofcom’s group director for networks and communications, said the changes are “in the best interest of consumers and businesses”.
She added: “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.”
She said that the regulator will make sure Royal Mail is clear with its customers about what is happening and pass the benefits of the changes on to them.
She also added: “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.”
But consumer groups have slammed the move, describing it as a “missed opportunity”.
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.”
He said that pushing ahead with plans to slash services and relax delivery targets to make savings will not automatically make letter deliveries more reliable or improve standards.
He added: “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.”
The postal service has already come under fire from customers in recent months after it hiked the price of stamps in April.
WHAT WILL THE CHANGES MEAN?
Ofcom said affordability and reliability are more important to Royal Mail customers than the speed of delivery.
But they do value having a next-day service for when they need to send the occasional urgent item.
Ofcom will therefore continue to require the Royal Mail to deliver First Class letters the next working day, Monday to Saturday.
It will also continue to cap the price of a second class stamp.
But Ofcom said customers have told it that most letters are not urgent so they do not need six days a week delivery for the majority of letters.
NO SERVICE DAYS
ROYAL Mail operates round the clock throughout most of the year.
But there are a handful of days when no delivery and collection services are offered:
- New Year’s Day
- Good Friday
- Easter Monday
- Early May Bank Holiday
- Spring Bank Holiday
- Summer Bank Holiday
- Christmas Day
- Boxing Day
Ofcom believes that the changes announced today will save Royal Mail between £250million and £425million a year.
The regulator is also making a small change to Royal Mail’s existing delivery targets.
Currently it needs to deliver 93% of all first class post the next day but this will be reduced to 90%.
Meanwhile, 95% of all second class mail will now need to be delivered within three days – down from 98.5%.
But many people have said they have experienced long delays where letters have taken weeks to arrive.
To tackle this, Ofcom has set Royal Mail a new backstop that 99% of all mail has to be delivered no more than two days late.
CHANGING HABITS
Customers are using the postal service less, particularly when it comes to sending letters.
In 2011/12 the Royal Mail delivered 14.3billion letters.
But that number fell to 6.6billion in 2023/24.
During this time revenues have also fallen.
Since 2008 Royal Mail’s revenues from letters has plummeted from £6.9billion to £3.7billion.
Meanwhile, in 2023/24 it made a loss of £348million, and in 2022/23 it made a loss of £419million.
The price of a first class stamp has also increased six times over the past two years, with costs now sitting at £1.70.
In April the postal service hiked the price of a first class stamp by 5p.
Its price has increased by 124% since 2020, when it cost just 76p.
At the same time it also pushed up the price of a second-class stamp by 2p to 87p.
The changes to the postal service come after Royal Mail was sold to Czech billionaire Daniel Kretinsky for £3.6billion, after the deal was cleared by the Government at the end of last year.
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