Ofcom fines Royal Mail £1.5m for missing delivery target
Ofcom today fined Royal Mail £1.5m for failing to meet its regulatory first-class delivery target in 2018.
The company is required by Ofcom to deliver at least 93 per cnet of its first-class post within one working day, but it fell to 91.5 per cent in 2018/19.
The regulator said the postal service failed to provide any reason why it missed the target.
“Royal Mail didn’t provide a satisfactory explanation for this, and didn’t take sufficient steps to get back on track during the year,” Ofcom said. “So, we’ve decided to impose a fine of £1,500,000 on Royal Mail for failing to meet its first-class delivery target.”
Ofcom has also fined Royal Mail £100,000 for overcharging customers for second-class stamps between 25 March and 31 March last year.
The regulator said: “For 1 April 2018 to 31 March 2019 the cap was set at 60p. However, Royal Mail increased its price for second-class stamps to 61p on 25 March 2019, overcharging customers for seven days until the cap increased on 1 April 2019.”
The company estimated it had overcharged people by approximately £60,000 as a result, which it is unable to refund.
Gaucho Rasmussen, Ofcom’s director of investigations and enforcement said: “Royal Mail let its customers down, and these fines should serve as a reminder that we’ll take action when companies fall short.”
The postal service said it accepts and understands the regulator’s decision. On the decision around the second class price cap, Royal Mail said: “We made a mistake… We worked with Ofcom throughout this investigation and lessons have been learned by us during this process.”
The company’s revenue has been hit by the pandemic since there has been a “substantial” switch from sending letters to parcels in the UK. Letter revenue plummeted 23 per cent in April, and it has announced it could cut up to 2,000 jobs.
Chief executive Rico Back stepped down two months ago after less than two years in the role.