Royal Mail have announced that from the 2nd of April the 2024 Stamp Prices will come into effect.
2024 Stamp Prices
- The price of a First Class stamp will increase by 10p to £1.35
- The price of Second Class stamps will increase by 10p to 85p
What is interesting is the marked increase of 1st Class postage since 2020. Over the past two decades, 1st & Second Class stamp costs roughly tracked each other, but from 2020 onwards the gap widened dramatically seeing 1st Class costs accelerate rapidly in comparison to 2nd Class. One might surmise that with Royal Mail’s excuses that letter volumes are falling and the USO unstainable, the more people that opt to use 2nd Class simply gives the company more time to deliver and not have to worry if a few days each week there is no post delivered.
And it’s not like it’s a great service – in Q3 (the last results available) Royal Mail only delivered 90.2% of Second Class mail within three working days against a target of 98.5%. It was worse for For First Class mail, with only 70.1% arrived within one working day against a target of 93%. Royal Mail do say that 94.4% of 1st class mail was delivered within three days of posting…. but that’s a second class service for a first class price.
Royal Mail has sought to keep price increases as low as possible in the face of increasing cost pressures and wage increases, declining letter volumes and lack of reform of the Universal Service Obligation (USO).
Letter volumes have fallen from 20 billion in 2004/5 to seven billion a year in 2022/3, while the number of addresses has risen by four million in the same period. The average adult spends less than £7 a year on stamped letters and people now receive on average just two letters per week.
The USO – which requires Royal Mail to deliver letters to all 32 million UK addresses six days a week – is in need of urgent reform. Delivering an ever-decreasing number of letters to an ever-growing number of households six days a week is increasingly expensive and unsustainable. Postal regulator Ofcom has recently opened a call for inputs to look at options for reform of the USO given the dramatic reduction in letter volumes in recent years.
The new price of First and Second Class stamps remain well below European mean average prices of £1.66 for First Class and £1.26 for Second Class.
– Royal Mail
It would be no surprise to see 1st Class priced out of the market in the coming years, indeed Ofcom are already mulling ideas such as a 2 1/2 day letter service (Monday, Wednesday & Friday one week, Tuesday & Thursday the next week in rotation). The more Royal Mail can ween us off a 1st Class service that isn’t being delivered the more likely we are to see delivery days cut and the more likely Royal Mail are to hit their Quality of Service fines which saw Ofcom £5.6m the company after they failed to reach their delivery targets in the 2022/23 financial year.
