Royal Mail faces a $13 million penalty for failing to meet delivery deadlines, despite being privatised over a decade ago. The company missed targets of 93% for first-class mail within one working day and 98.5% for second-class post within three working days. Royal Mail blamed its poor performance on financial challenges and strike action, but Ofcom stated that these reasons are not justifiable.
Royal Mail was privatised over a decade ago, but it is still legally required to deliver letters across the UK at a set price six days a week.
Under Ofcom’s rules, the postal operator is meant to deliver at least 93% of first-class mail within one working day. In the year to the end of March, Royal Mail missed both targets, reaching figures of just 74.7% and 92.7% respectively for first and second class mail.
According to Ofcom, Royal Mail blamed its poor performance on: Its challenging financial position Delays to a ballot on a pay deal following strike action by members of the Communication Workers’ Union last year However, Ofcom stated that these reasons are not justifiable for Royal Mail’s failure to provide the expected levels of service.
This is the second year in a row the company has been fined by Ofcom for poor delivery performance. Ofcom director of enforcement Ian Strawhorne stated that “Royal Mail has provided an improvement plan, and we’re seeing some signs of progress, but it must go further and faster to deliver the service that people expect.”
According to Ofcom, Royal Mail’s poor service is now eroding public trust in one of the UK’s oldest institutions. International Distribution Services (IDS), Royal Mail’s owner, said it has carried out “substantial” reforms this year to try to drive improvements. However, Ofcom remains unconvinced, stating that more needs to be done for Royal Mail to meet its delivery targets.
In the year leading up to March 2024, Royal Mail failed to meet both of its targets: Delivering at least 93% of first-class mail within one working day Delivering at least 98.5% of second-class post within three working days Instead, it reached figures of just 74.7% and 92.7%, respectively.
The company blamed its poor performance on: Ofcom stated that Royal Mail took insufficient and ineffective steps to prevent this failure, which impacted millions of customers who did not receive the service they paid for. In response, Royal Mail owner International Distribution Services (IDS) said it had carried out substantial reforms to drive improvements.
Ofcom director of enforcement Ian Strawhorne stated that Royal Mail’s poor service is eroding public trust in one of the UK’s oldest institutions. He emphasized the need for Royal Mail to improve its performance and deliver the expected level of service.
A probable takeover by Czech billionaire Daniel Kretinsky’s EP Group has been announced, with International Distribution Services facing potential changes under new ownership.
