The Unfolding Disaster of The Privatised Royal Mail - First Class Stamp To Be £1.65 And Many Other Increases.

7th September 2024

From the BBC highlighting the new charges from 7 October 2024.

Royal Mail has announced it will hike the price of first-class stamps by 30p due to "very real and urgent" financial challenges.

The increase, which will kick in from 7 October, will see the price of a first-class stamp rise to £1.65, while second-class stamps will remain at 85p.

The company said it was facing pressure from declining letter volumes and rising business costs in maintaining the one-price-goes-anywhere universal service.

It has called for the service terms, under which it is legally obliged to deliver letters six days per week, Monday to Saturday, and parcels Monday to Friday, to be reformed.

"We always consider price increases very carefully. However, when letter volumes have declined by two-thirds since their peak, the cost of delivering each letter inevitably increases," said Nick Landon, chief commercial officer at Royal Mail.

"We are proud to deliver the Universal Service, but the financial cost is significant."

The decision to increase first-class stamp prices comes after the UK's postal regulator said on Thursday that the company could be allowed to end the delivery of second-class letters on Saturdays, as part of reforms being considered.

Ofcom has also said it is looking into whether to allow second-class deliveries to be made on alternate weekdays, which could help cut costs for Royal Mail.

But on Friday, Royal Mail said it still had "no certainty on regulatory reform".

The company, which was split from the Post Office and privatised a decade ago, has repeated its argument that the universal service is in need of "urgent reform".

It said that its minimum requirements had not changed for more than 20 years, despite changes in how people communicate.

In recent years, the volume of letters being posted has plummeted, while parcel deliveries have become more popular - and more profitable for Royal Mail.

But despite parcel postage growing and stamps being hiked several times in the past two years, the company has struggled financially, making a heavy £419m loss last year.

Royal Mail's performance has also deteriorated, with customers regularly not receiving letters on time, particularly for medical appointments and legal documents.

"The rate of letter decline and ongoing losses means that Royal Mail has had to take the necessary steps within its power to address the very real and urgent financial sustainability challenge the universal service faces right now," the company said.

According to Royal Mail, the amount of letters being posted have fallen from 20 billion a year in 2004-05, to about 6.7 billion in 2023-24, with the average household receiving four letters per week, compared with 14 about two decades ago.

Note
There have already been several price increases in 2024 including stamps and many other services.
For the full range of price increases go to
https://www.royalmail.com/prices2024

Privatised in 2013
UK Gove sold its final 30% share in 2015
https://en.wikipedia.org/wiki/Royal_Mail

The Current Owner of Royal Mail
International Distribution Services

But Things may change again
Royal Mail owners agree to 5 billion pounds takeover offer
Czech billionaire Daniel Kretinsky has firmed up an offer of £5bn, including assumed debts, for the company which employs more than 150,000 people.

History of the Royal Mail When it was General Post Office