- Royal Mail wants to guarantee first-class deliveries six days a week
Royal Mail has proposed a raft of operational changes in a bid to save £300 million a year.
Royal Mail, owned by International Distributions Services (IDS), wants that is delivering all non-first class and second class mail every other weekday, amid regulator Ofcom’s calls for universal service reform due to falling letter volumes.
Under the proposals, the delivery of standard bulk business mail for items such as bills or statements would be ‘aligned with Second Class’ so that they would arrive within three weekdays instead of two.
Proposals: Royal Mail wants to deliver non-first or second class mail every other weekday
Royal Mail said it wants to maintain daily delivery of first-class letters between Mondays and Saturdays under new reform proposals it has put forward.
The government previously opposed the reduction of the six-day service.
Parcel deliveries would remain unchanged and would still be delivered ‘up to seven days a week’, the report said.
Likewise, the proposals would ensure that customers continue to have the opportunity to purchase first or second class stamps.
Under the proposals, there would be a net reduction in the number of daily delivery routes from 7,000 to 9,000 over the course of around 18 to 24 months, Royal Mail said.
The company expects that there will be no forced redundancies and ‘fewer than 1,000 voluntary redundancies’.
The reduction would be managed through ‘natural attrition’ where possible, the report said.
Call for change: Martin Seidenberg is the group director of IDS
Martin Seidenberg, group director of IDS, said: ‘The fact that the number of letters has fallen from 20 billion to seven billion per year means that the Universal Service is now unsustainable.
‘If we want to save the Universal Service, we have to change the Universal Service. Reforms give us a fighting chance and will help us on the path to sustainability.
‘Our proposal is based on listening to thousands of people across the UK to ensure it meets their needs.
‘We have worked hard to come up with a proposal that is good for our customers, good for our people and that would enable Royal Mail to invest in the products and services that Britain wants.
‘We are seriously concerned that the urgency of the situation is not being properly recognized by Ofcom. Because no legislation is needed, you don’t have to wait.’
Royal Mail called on Ofcom to modernize the Universal Service. It said it wants to see additional “reliability targets” and “realistic speed targets” for first and second class services.
It also wants tracking added to Universal Service packages to “reflect customer demand.”
The group said it costs the company between £1 million and £2 million every day to deliver the Universal Service to Britain.
Royal Mail added on Thursday: ‘The proposed reform can be achieved through regulatory changes, without the need for legislation.
‘Royal Mail is urgently calling on Ofcom to move faster in implementing changes, with new regulations being introduced by April 2025.’
It expects letter volumes to drop to around four billion over the next five years.
Under current Ofcom rules, Royal Mail is required to deliver 93 percent of first class mail within one working day and 98.5 percent of second class mail within three working days each year. These objectives are not always achieved.
Royal Mail said the proposed operational changes would ‘create a more financially stable future for the company and its shareholders, protecting tens of thousands of jobs’.
Royal Mail posted a loss of £419m for the 2022-2023 period and a £319m loss for the first six months of 2023-2024.
Ofcom will provide an update on the proposals in the summer.