Royal Mail has been slapped with a £10.5 million fine by Ofcom for failing to meet delivery standards, with over a quarter of first-class mail arriving late.
This comes after a £5.6 million penalty imposed by the postal regulator last November for similar failings.
Under Ofcom’s rules, Royal Mail is required to deliver 93% of first-class mail within one working day and 98.5% of second-class mail within three working days.
However, an investigation revealed that in the year ending March 2024, the company delivered only 74.7% of first-class mail on time and 92.7% of second-class mail within the specified period.
The postal service attributed these delays to financial challenges and the fallout from industrial action last year, but Ofcom rejected these explanations.
“We do not consider these to be justifiable reasons for Royal Mail’s failure to meet its obligations,” Ofcom stated. “Millions of customers were likely impacted by the company’s insufficient and ineffective measures to address the issues.”
Ofcom criticised Royal Mail’s marginal improvement in performance over the past year, calling for significant changes.
Ian Strawthorner, Ofcom’s director of enforcement, expressed concern over the erosion of public trust in the historic institution.
“With millions of letters arriving late, customers are not receiving the service they pay for. While progress has been made, Royal Mail must act more swiftly and effectively to meet expectations,” he said.
The penalty, which will be paid to the Treasury, was initially set at £15 million but was reduced due to Royal Mail’s admission of liability and agreement to settle the case.
The deterioration in delivery times comes at a critical juncture for Royal Mail, as a major takeover deal nears completion.
The company has also been lobbying Ofcom for permission to reduce second-class letter deliveries to two or three days a week, a move that could save £300 million annually and lead to nearly 1,000 job cuts.
Despite the fine, Royal Mail claims to be implementing substantial changes to improve its services. A spokesperson stated, “We are committed to driving improvements in mail delivery to ensure better outcomes for our customers.”
The Communication Workers Union (CWU) has placed the blame on the company’s leadership, calling the poor performance a result of “deliberate, sustained dismantling of UK postal services by a failed board and senior management team.”
With mounting pressure to restore public confidence and meet regulatory standards, Royal Mail faces an uphill battle to repair its reputation as one of Britain’s oldest and most trusted institutions.
