Royal Mail fined £10.5m for missing delivery targets

Royal Mail has been fined £10.5m by the regulator for failing to meet delivery targets for first and second class mail.

It is the second year in a row the company has been fined by Ofcom for poor delivery performance.

The regulator said Royal Mail had failed to “significantly improve service levels”.

It said 74.7% of first class mail and 92.7% of second class were delivered on time in 2023-24, well short of the targets of 93% and 98.5%.

Ofcom said the company had blamed its poor performance on its challenging financial position, and on delays to a ballot on a pay deal following strike action by members of the Communication Workers’ Union last year.

However, Ofcom said: “We do not consider either of these to be justifiable reasons for Royal Mail’s failure to provide the levels of service expected of it.

“Royal Mail took insufficient and ineffective steps to try and prevent this failure, which is likely to have impacted millions of customers who did not get the service they paid for.”

Last year, Royal Mail was fined £5.6m for the same reason.

Ofcom said that in addition to the fine, it had been pressing the company to see what it was doing to improve its performance.

While there had been some progress, it said performance in 2023/24 had only been “marginally better” and “it needs to do much better”.

News of the latest fine comes at a time when Royal Mail’s parent, International Distribution Services, is facing a probable takeover by the Czech billionaire Daniel Kretinsky’s EP Group.