Royal Mail has again fallen short of its Royal Mail delivery targets, posting first-quarter figures that sit below the thresholds set by Ofcom, the communications regulator, even after those thresholds were lowered in April.
Ofcom is the government-appointed body that regulates postal services in the UK. It sets the benchmarks Royal Mail must hit and has the power to fine the company when it does not.
In the first quarter of this year, Royal Mail delivered 85% of first-class mail the next day and 91.4% of second-class mail within three working days. The current Ofcom targets require 90% of first-class mail to arrive the following day and 95% of second-class mail within three days. Both figures fall short.
How the Royal Mail delivery targets have shifted
The targets in force now are already reduced from their previous levels. From 1 April, Ofcom lowered the first-class benchmark from 93% and the second-class benchmark from 98.5%, as part of wider reforms to the universal postal service. Those reforms, approved by Ofcom last July, also allow second-class letters to be delivered on alternate weekdays only, scrapping Saturday second-class deliveries. The changes were designed to reflect steep declines in the number of letters being sent.
Alongside the new, lower targets, Ofcom introduced what it calls an “enforceable” backstop: 99% of mail must be delivered no more than two days late. Royal Mail missed that backstop too, though it closed the gap: 98.1% of first-class post arrived within three days and 98.4% of second-class within five days.
Royal Mail says the direction of travel is positive. A year ago, its first-quarter figures showed only 76% of first-class and 89.3% of second-class post arriving on time. Jamie Stephenson, Royal Mail’s chief operating officer, said: “These results are encouraging and show that the work we are doing to improve the service is having an impact. First-class performance is well ahead of where we expected to be at this stage of our improvement plan, while second-class is tracking in line with the plan.” He added that “we know there is more to do.”
A record fine and a pattern of breaches
The backdrop to these figures is a history of regulatory penalties that has grown steadily more expensive. In October last year, Ofcom fined Royal Mail £21 million for missing its delivery targets in 2024-25. According to The Guardian, it was the third-biggest financial penalty Ofcom has ever issued to any company.
The BBC reported that Ofcom had originally calculated the fine at £30 million but reduced it by 30% to reflect Royal Mail’s admission of its failings. Even at £21 million, it stands as the largest penalty in the company’s history.
In a statement published by Ofcom, the regulator said: “This is the third time we have found the company in breach of its regulatory obligations in recent years, after we fined it £5.6m in November 2023 and £10.5m in December 2024.” The total across the three fines reaches £37.1 million. Ofcom also launched a further investigation in June into Royal Mail’s failure to meet targets for the second year running, covering the 12 months to the end of March.
Royal Mail has pledged to meet the Ofcom delivery targets by May 2027, as part of a commitment to invest £500 million in the service over the next five years. The company is also rolling out a new delivery model across all 1,200 of its delivery offices, with completion expected by Christmas. The rollout was initially delayed until Royal Mail reached agreement with trade unions.
Royal Mail’s owner, International Distribution Services, was bought by Czech billionaire Daniel Kretinsky. The group’s most recent full-year figures showed operating profits more than halved to £96 million, after labour costs rose sharply following minimum wage increases and an additional £133 million employee tax bill. Parcel volumes rose 7% to 1.4 billion over the year, but addressed letter volumes fell 10% to 5.7 billion.
Calls for stamp price caps
Citizens Advice has called on Ofcom to cap stamp price rises while Royal Mail continues to miss its targets. Tom MacInnes, director of policy at Citizens Advice, said: “Despite Ofcom lowering the company’s delivery targets in April, Royal Mail has already claimed it needs until next Spring before it can actually meet them. This is not good enough and fines for poor service have had little impact. We now want to see Ofcom using stamp price caps to ensure Royal Mail can’t go on increasing prices while missing targets.”
Whether Ofcom acts on that call may depend partly on what its current investigation concludes, with Royal Mail’s self-imposed May 2027 deadline now the clearest fixed point on the calendar.
