Royal Mail has announced plans to cut up to 2,500 head office and support function roles by the end of 2027, as part of what the company described as a “significant transformation”. The move comes as the business implements universal service reform and adapts to a rapidly changing market.
Letter volumes have declined by more than 70% since their peak, while customer demand for faster and more convenient parcel delivery services continues to grow, the company said.
Transformation programme details
In a statement, the mail service said: “As part of its transformation programme, Royal Mail is simplifying processes and functions across the business and today announced proposals for an organisational review of head office and support functions.”
Alistair Cochrane, chief executive officer of Royal Mail, said: “We have been working hard to reduce costs and simplify processes across all areas of the business as we transform to win in a very competitive market.
“These proposed changes remove duplication and allow us to invest further in the service we deliver for our customers.
“We are committed to treating everyone fairly and respectfully throughout this process, working closely with our trade unions.
“The proposed changes will not be easy, but they are an important part of building a stronger, simpler and future-ready Royal Mail for our customers and colleagues.”
Price increases and service changes
The announcement comes one day after the mail service increased prices on parcel deliveries. The increase on Standard, Tracked, Special Delivery and Signed For options came into effect on October 6, with customers facing increases of between 25p and £1.45.
Customers sending first class medium parcels up to 20kg will face the biggest changes, with prices rising from £15.45 to £16.90.
Government response and union concerns
Last month, the Government responded after concerns were raised over Royal Mail standards, including “failed” letter delivery standards and “worsening conditions” for staff.
Changes already in place include alternating schedules for second-class letters, higher stamp costs, and updated tracking notifications. Ofcom also lowered the firm's official targets to allow 90% of First Class mail to be delivered next-day, while second-class now aims for 95% to be delivered within three working days.
Campaigners have said the move is not enough and have called for the company to be taken back into public ownership. At the Labour Party Conference in Liverpool, the Communications Union launched a motion urging the Government to introduce “democratic public control and oversight and worker and customer representation”.
In a letter sent to all union members on September 28, general secretary Dave Ward and deputy secretary Martin Walsh said: “The motion recognises that Royal Mail is a vital public service, rooted in every community across the UK, that today faces existential threats to its future including:
“The undercutting of postal workers’ jobs and the company through multinational competitors that utilise bogus self-employment.
“The devaluing of postal workers’ jobs. While postal workers recognise the need for change, the company’s failure to end two-tier terms and conditions is creating a recruitment and retention crisis leading to under-staffing and unmanageable workloads.
“A failure of the previous and current leadership board of Royal Mail to address quality of service problems that are damaging the brand, letting down customers and demoralising postal workers.
“A regulator that is acting against the interests of the universal service and in favour of promoting unfair competition.
“The lack of vision from the leadership of the company to develop a new growth strategy that offers a future for Royal Mail and our members jobs in permanently changed world of communications.”
However, the Government has rejected the idea of public ownership. In a statement, it said: “The Government has no current plans to return Royal Mail to public ownership. Our priority is to ensure the provision of a universal postal service that does not compete for public funds.”
It continued: “Royal Mail is a critical part of our national infrastructure, providing crucial services for millions across the UK, and is an iconic part of UK national life. Privatisation was necessary to ensure this critical institution continues and that there is a consistent provision of a universal postal service that does not compete for public funds, which should be used to fund the NHS and other public services.
“The designated universal service provider remaining within the private sector with access to the capital needed to transform the business and ensure its long-term financial sustainability, is therefore the most appropriate option at this time.”
