Disaster for Royal Mail as it’s slapped with huge £21m fine | UK | News
Royal Mail has been fined £21 million for failing to meet first and second class mail delivery targets. ofcom he said. The regulator announced the penalty on Wednesday (October 15), saying it was the third time in recent years it had found the company had breached its regulatory obligations. Royal Mail He was fined £5.6 million in November 2023 and £10.5 million in December 2024, according to Ofcom.
Ian Strawhorne, Ofcom’s Director of Enforcement, said in a statement: “Millions of important letters are arriving late and people are not getting what they paid for when buying stamps. These persistent failures are unacceptable and customers expect and deserve better.” This penalty is the third highest penalty ever imposed by Ofcom. Royal Mail said it would work hard to continue improvements to its service.
Mr Strawhorne said Royal Mail urgently needed to rebuild consumer trust, adding: “This means making real significant improvements, not more empty promises.
“We have told the company to publicly explain how it will implement this change, and we expect to see meaningful progress soon. If this does not happen, fines will likely continue.”
Ofcom said it measured Royal Mail’s delivery performance against its annual UK-wide delivery targets from April to March.
For 2024-25, the company was required to deliver 93% of First Class mail within one business day of collection and 98.5% of Second Class mail within three business days.
Ofcom said that if Royal Mail failed to meet its annual targets, it would consider evidence of exceptional circumstances beyond the company’s control, such as extreme weather, and whether the company would have met its targets had these events not occurred.
Ofcom said that even after accounting for extreme weather conditions, Royal Mail delivered just 77% of First Class mail and just 92.5% of Second Class mail on time between April 2024 and March this year.
Ofcom said the company had breached its obligations by failing to provide an “unjustified” acceptable level of service.
The regulator accused Royal Mail of taking “inadequate and ineffective” steps to prevent the failure; Ofcom said this was likely to have affected millions of customers who did not receive the service they paid for.
According to Ofcom, Royal Mail was facing a £30 million fine, but its admission of responsibility and willingness to resolve the case saw the total fine reduced by 30%.
Ofcom said it took into account the “harm” suffered to customers and Royal Mail’s “poor” service and breach of its obligations for three consecutive years when deciding the amount. The regulator said it also took into account Royal Mail’s financial situation.
As well as fining the company, Ofcom is pressing Royal Mail for details of what it is doing to improve. Ofcom said Royal Mail’s plans to reach 85% for First Class mail and 97% for Second Class mail by March 2025 would have resulted in a “significant” improvement, but this did not happen.
A Royal Mail spokesman said the company accepted Ofcom’s decision and would continue to work hard to deliver further continuous improvements in the quality of its service.
They added: “The detailed work ahead of the full implementation of our new delivery model, made possible by Ofcom’s changes to the Universal Service, has been a key area for focus and investment.
“This has been critical to enable us to make a step change in service quality. We have also implemented significant changes across our network, including the recruitment, retention and training of our employees and the provision of additional support to distribution offices.”
The spokesman added that where Royal Mail has piloted Universal Service changes, it has seen the model work, including improvements to deliveries. They said: “This will help us deliver a modern, reliable and more financially sustainable postal service that meets the needs of today’s postal users.”
