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Royal Mail has been fined £21 million by Ofcom for failing to meet key First- and Second-Class delivery targets in the 2024/25 financial year – the third-largest fine the UK regulator has ever imposed.
In a warning to the UK’s postal operator, Ofcom accused Royal Mail of “persistent failures” and ordered the company to publish a credible improvement plan or face further penalties.
The fine follows previous sanctions in 2023 and 2024, bringing the total financial penalties against Royal Mail over three years to more than £37.1 million.
Royal Mail delivered just 77% of First-Class letters within one working day and 92.5% of Second-Class mail within three working days, falling short of the 93% and 98.5% targets required. Ofcom found these performance levels to be unjustified, even after accounting for exceptional events.
“Unacceptable and persistent failures”
In a statement, Ian Strawhorne, Ofcom’s Director of Enforcement, said: “Millions of important letters are arriving late, and people aren’t getting what they pay for when they buy a stamp… 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. We’ve told the company to publicly set out how it’s going to deliver this change, and we expect to start seeing meaningful progress soon. If this doesn’t happen, fines are likely to continue,” he added.
Ofcom concluded that Royal Mail took “insufficient and ineffective steps” to prevent widespread delays in the 2024/25 financial year and failed to justify the poor performance with exceptional circumstances.
Millions of customers were left without the timely delivery of important letters, including medical appointments, legal documents, and time-sensitive communications, Ofcom noted.
Ofcom demands an urgent turnaround
The £21 million fine includes a 30% reduction from the maximum penalty of £30 million, in recognition of Royal Mail’s cooperation and acceptance of liability. The money will be paid to HM Treasury.
The regulator stressed that the size of the fine reflects both the impact on consumers and the company’s repeated non-compliance over three consecutive years.
While Royal Mail returned to profitability in 2024/25 with a modest £12 million profit, the company posted losses of £419 million and £348 million in the previous two years. The regulator said it had balanced these financial realities against its duty to ensure the universal postal service remains financially sustainable.
Royal Mail had produced an internal improvement plan for 2024/25, with revised goals of delivering 85% of First-Class and 97% of Second-Class letters on time by March 2025. But Ofcom said this plan “did not materialise” in practice and urged the company to urgently publish and deliver a more robust and credible strategy.
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