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Royal Mail is under investigation by Ofcom after failing to meet delivery targets, with less than three-quarters of first-class mail delivered on time last year.
According to Royal Mail’s parent company, International Distribution Services (IDS), only 74.5% of first-class mail met the one-working-day delivery requirement.
Ofcom regulations mandate that 93% of first-class mail should be delivered within the stipulated timeframe, excluding the Christmas period. The regulator stated, “If it does not provide a satisfactory explanation and we determine Royal Mail has failed to comply with its obligations, we will consider whether to impose a financial penalty.” This follows a £5.6 million fine imposed on Royal Mail last year for similar failures in 2022-23.
Royal Mail’s latest figures, showing delayed performance, were released late on Friday after market closure. IDS’s financial results reveal that Royal Mail’s losses have narrowed to £348 million from £419 million for the year ending 31 March. IDS CEO Martin Seidenberg commented, “We have improved quality, won back customers lost during industrial action, controlled costs and delivered Christmas for our customers.”
These results come as IDS anticipates a potential buy-out offer from Czech billionaire Daniel Kretinsky, who proposed a bid worth approximately £3.5 billion on 15 May. Business Secretary Kemi Badenoch has emphasized the need to protect Royal Mail’s universal service obligation in any sale. IDS has indicated that Kretinsky is willing to provide “contractual undertakings” to safeguard key public interest factors, acknowledging Royal Mail’s role as a crucial part of national infrastructure.
The proposed commitments include maintaining six-day-a-week first-class letter deliveries under the universal service, protecting workers’ rights, preserving the Royal Mail brand, and keeping the company’s UK headquarters and tax residence.
