Ofcom has launched a new investigation into Royal Mail after the company once again failed to meet its annual delivery targets, with nearly a quarter of first-class mail arriving late. The postal regulator revealed on Friday that 24.3% of first-class letters failed to arrive on time in the year ending March, a decline from 23.5% the previous year.
Persistent Failures and Penalties
Royal Mail has not met its Ofcom-mandated delivery target for first-class post since 2017, or for second-class mail since 2020. The company has already faced fines totaling £37 million since 2023 for routinely falling short of these targets. In October, Ofcom imposed a £21 million penalty, the third-largest financial sanction it has ever issued to any company.
The regulator requires 93% of first-class mail to be delivered within one working day of collection, excluding Christmas. Royal Mail achieved only 76.7% compliance in the latest year. For second-class mail, the target is 98.5% within three working days, but the company managed just 90.2%.
Investigation Focus
Ofcom stated that its investigation will examine whether Royal Mail has prioritised parcel delivery over letters, a practice alleged by whistleblowers and unions but denied by the company. The regulator will also consider exceptional events beyond Royal Mail's control that may have affected performance. If a breach is found, Ofcom will decide on a financial penalty.
Industry Context
Royal Mail's struggles come amid a sharp decline in letter volumes, dropping from 20 billion letters a decade ago to 6.7 billion, with projections of 4 billion within four years. Meanwhile, the number of addresses served has increased by 4 million. In April, Royal Mail raised the price of a first-class stamp by 10p to £1.80, more than double the cost in 2020. Second-class stamps rose by 4p to 91p.
Last July, Ofcom allowed Royal Mail to relax its universal service obligation, ending Saturday second-class deliveries and reducing service to alternate weekdays. In 2025, Czech billionaire Daniel Křetínský completed a £3.6 billion purchase of Royal Mail's parent company, International Distribution Services, after UK government approval.
Royal Mail Response
A Royal Mail spokesperson said the company will engage fully with Ofcom and that improving service quality is a top priority. They highlighted a £500 million investment programme over five years to modernise the postal service and implement changes to universal service regulations introduced in July 2025.
