Britain’s postal regulator has opened an investigation into Royal Mail after the company again missed its annual delivery targets, with almost a quarter of first-class letters arriving late. Royal Mail said 24.3% of first-class mail failed to reach recipients on time in the year to the end of March, slightly worse than the previous year’s 23.5% miss rate. Under Ofcom’s rules, 93% of first-class mail must be delivered within one working day of collection, excluding Christmas.
The new figures also showed poor performance for second-class post. Royal Mail delivered 90.2% of second-class mail within the required three working days, well below Ofcom’s 98.5% target. The company has now failed to meet the regulator’s delivery standards for first-class mail since 2017 and for second-class mail since 2020.
Ofcom said it will examine whether Royal Mail breached its regulatory obligations and whether it has been prioritising parcel deliveries over letters, an allegation made by whistleblowers and unions but denied by the company. The watchdog said it will also consider whether any exceptional events beyond Royal Mail’s control affected service levels. If a breach is found, Ofcom said it may impose a financial penalty.
The investigation comes after a series of sanctions against the company. Since 2023, Royal Mail has been fined £37m for repeated failures to meet delivery standards, including a £21m penalty in October, one of Ofcom’s largest fines. The company’s problems come as it faces pressure to modernise a postal network handling far fewer letters than in the past.
Royal Mail has pointed to major changes in the market and its own costs. It raised the price of a first-class stamp by 10p to £1.80 in April, while second-class postage rose to 91p. The company said the increases reflected the continued rise in the cost of delivering each letter. It has also argued that regulatory changes are needed to keep the universal postal service sustainable.
In July, Ofcom allowed Royal Mail to reduce its universal service obligation, ending Saturday second-class deliveries and shifting the service to alternating weekdays. The reforms were intended to reflect falling letter volumes and changing customer habits. A decade ago, Royal Mail delivered about 20 billion letters a year; that has fallen to 6.7 billion and could drop to 4 billion within four years, even as the number of addresses it serves has grown by 4 million.
Royal Mail is now owned by International Distribution Services, which was acquired by Czech billionaire Daniel Křetínský in a £3.6 billion takeover completed last year after UK national security approval. Royal Mail said it would fully cooperate with Ofcom and that improving service quality remained a top priority. The company said it is investing £500 million over five years in a reform programme aimed at long-term improvements as it introduces a new delivery model under the updated regulations.
