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Royal Mail has warned stamp prices will rise AGAIN due to a £120 million hit from the Labour Party Budget. The boss of the postal service told reporters this morning that he could not rule out hiking stamp prices even higher.
It comes as it faced the enormous burden of extra costs. Martin Seidenberg, chief executive of International Distribution Services (IDS), said: “We are looking at all measures including pricing, parcel cost efficiencies, investment plans, automation and our parcel network.
“I cannot rule out [increasing stamps prices] but we will be looking at not just consumer letters but also business mail and parcels as well.” The Royal Mail boss said the Budget changes “disproportionately impacts us compared to our peers”.
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He added: “But it’s important to know that there is a cost of going up and down every garden path, and as population increases and letter volumes go down there is a heavy cost.” The firm said a £134 million write-down linked to the national insurance increase has stopped it returning to profit for the past six months.
The company, which employs around 130,000 workers in the UK, said the jump in costs means that reforms to its universal service obligations – which currently requires it to make first-class deliveries six days a week – are “more urgent”.
The boss said the company – which agreed a takeover deal earlier this year – could look at increasing automation in order to help it address the increase in its cost burden. Mr Seidenberg said the rise in its costs “increases the need” for service reform, with the company hoping for a decision from regulator Ofcom of a review in its universal service obligations (USO) by early next year.
It comes after the Royal Mail hiked stamp prices last month in a blow to UK customers.
