Royal Mail fined millions for failing to meet delivery targets again

Royal Mail has been fined £21m for failing to meet delivery targets for the third year in a row and warned fines are likely to continue unless there’s an improvement.

As well as failing to meet current delivery times for both first and second class mail, Royal Mail did not meet revised down targets agreed with Ofcom.

The delivery network delivered 77% of first class mail and 92.5% of second-class mail on time from April 2024 to March this year, “well short” of its 93% and 98.5% targets, the communications regulator said.

Money blog: Major changes to vet prices proposed after investigation

It’s also below the reduced goals which were set out for the delivery company at the start of the year – bringing down the percentage of first class post delivered the next day from 93% to 90%, and second class mail delivered within three days from 98.5% to 95%.

The latest fine is double that levied last year, £10.5m, and nearly quadruple the £5.6m fine in 2023 because of the repeat offending.

It’s the third-largest fine ever levied by Ofcom and would have been higher, £30m, but for Royal Mail’s admission of wrongdoing and agreement to settle.

Millions not getting what they pay for

Royal Mail has, without justification, failed to provide an acceptable level of service and breached its obligations, Ofcom said.

“It took insufficient and ineffective steps to try and prevent this failure, which is likely to have impacted millions of customers who did not get the service they paid for.”

People have also been experiencing times when letters have taken weeks to arrive.

Ian Strawhorne, director of enforcement at Ofcom, said: “Millions of important letters are arriving late, and people aren’t getting what they pay for when they buy a stamp.

“These persistent failures are unacceptable, and customers expect and deserve better.

“Royal Mail must rebuild consumers’ confidence as a matter of urgency. And that means making actual significant improvements, not more empty promises.”

Real world harms

In highlighting the real-life consequences of the delivery delays, Citizens Advice said it had encountered someone who got a pile of mail with their council tax bill, a court summons for a passed court hearing date and a liability order for the debt, all at the same time.

Another client of the service was sent an eviction notice, which had not arrived more than a week after a copy came from the landlord’s solicitors.

They were unsure if the warrant would arrive by the time the bailiffs came and were unsure how to act, Citizens Advice said.

What next?

Royal Mail has been ordered by Ofcom to urgently and publicly set out and implement a “credible plan” on how it is going to change.

The regulator said it expects to see “meaningful progress soon”, rather than “more empty promises”.

Improvements Ofcom had pressed for have not materialised, it said, and Royal Mail has been called on to make “actual significant improvements”.

“If this doesn’t happen, fines are likely to continue,” the regulator warned.

Ofcom said the “persistent failures” are unacceptable, and customers expect and deserve better.

“Royal Mail must rebuild consumers’ confidence as a matter of urgency,” it added.

The company has also been set a new enforceable target for 99% of mail to be delivered no more than two days late.

How has Royal Mail responded?

A Royal Mail spokesperson said: “We acknowledge the decision made by Ofcom today and we will continue to work hard to deliver further sustained improvements to our quality of service.”

The company has implemented “important changes across our network including recruiting, retaining and training our people, and providing additional support to delivery offices”, they said.

“Where we have piloted universal service changes, we can see that our model is working, with improvements in deliveries,” the spokesperson added.