Ofcom has opened an investigation into Royal Mail’s failure to meet its delivery targets for 2023/24, following the company’s publication of its latest performance results.
Under our rules, Royal Mail is required to meet specific performance targets across the whole financial year, excluding the Christmas period. Among other targets, Royal Mail must:
- deliver 93% of first class mail within one working day of collection; and
- deliver 98.5% of second class mail within three working days of collection.
Royal Mail has acknowledged that it did not meet the above performance targets in 2023/24, as it:
- delivered 74.5% of first class mail within one working day; and
- delivered 92.4% of second class mail within three working days.
In deciding whether the company is in breach of its obligations, Ofcom will consider if there were any exceptional events – beyond the company’s control – that may have explained why it missed its targets. If it does not provide a satisfactory explanation and Ofcom determine that Royal Mail has failed to comply with its obligations, they will consider whether to impose a financial penalty.
Last year, Ofcom fined the company £5.6m for failing to meet its first and second class delivery targets in 2022/23.
Royal Mail has failed to meet its targets for the last four years. With questions now raised about both the future ownership of Royal Mail and its obligations to consumers, it’s more important than ever Ofcom sorts this out.
We’re seriously worried about the future of our postal service. Despite routine investigations by Ofcom and fines for Royal Mail, these penalties are simply becoming the cost of doing business. They’re certainly not resulting in the much-needed improvement of its service.
What’s more, in the current review of Royal Mail’s Universal Service Obligation (USO) we’ve seen very little commitment from either Royal Mail or Ofcom to tackle this properly. Instead, all proposals pave the way for a slower and more expensive postal service, which consumers will bear the cost of. Ofcom and the government must spell out how the revised USO will deliver for the millions who rely on it, not just for Royal Mail’s prospective new owners.
– Morgan Wild, Interim Director of Policy, Citizens Advice
