First class stamp to cost more than £1, says Royal Mail

A first class stamp is to cost more than £1 following an inflation-busting increase, Royal Mail has announced.

The cost of sending letters overnight will rise from 95p to £1.10 in April, Royal Mail confirmed, months after the postal operator warned significant price rises would be necessary unless it was allowed to scrap Saturday deliveries.

The 16pc uplift is well-ahead of inflation, which is currently running at 10.1pc, and follows an 11pc increase last March.

The price of a second class stamp will also increase by 7p to 75p from April 3.

Matthew Upton, director of policy at Citizens Advice, said: “These record-breaking prices couldn’t be coming at a worse time for consumers, who’ll now be paying 64pc more for a first class stamp than five years ago.

“Almost one in five people are already struggling with current prices for second class stamps.”

Royal Mail said the price rise was necessary to keep its Universal Service agreement sustainable, whereby it pledges to deliver anywhere in the country for the same price.

Nick Landon, chief commercial officer at Royal Mail, said: “We need to make these price changes to ensure we can continue to maintain and invest in the one-price-goes-anywhere Universal Service for years to come.”

In December, Royal Mail chairman Keith Williams said a “considerable” increase in the cost of a first class stamp would be needed to balance the books if it was to continue with a six-day letter delivery service.

In his former role as business secretary, Grant Shapps said he would not approve Royal Mail’s plans to axe Saturday rounds.

Royal Mail wants to end weekend letter deliveries in the face of declining volumes. The number of letters sent has dropped by a quarter since the pandemic.

The stamp price rises come as Royal Mail struggles to recover from a cyber attack that left it unable to deliver international post and as the company faces worker unrest over pay and conditions. Postal workers downed tools at the end of last year and voted for further strike action last month.

Mr Upton said: “Royal Mail is choosing to hike prices at a time when millions are missing important letters, thanks to post delays. Nobody should be paying more for this kind of subpar service.

“Ofcom should be holding Royal Mail to account, but it’s letting the company get away with rocketing prices and over two years of missed delivery targets. Enough is enough, it’s time for the regulator to act.”

Mr Landon said: “We appreciate that many businesses and households are facing a challenging economic environment and we are committed to keeping our prices affordable.

“Letters have declined by 25pc compared to pre-pandemic. We have to carefully balance our pricing against a continued decline in letter volumes and the increasing costs of delivering letters six days a week to an ever-growing number of addresses across the country.

“We are seeing a fundamental change in consumer needs with a greater shift in demand from letters to parcels.”