Royal Mail has been fined £21m by the communications regulator Ofcom for missing its annual delivery targets, with 'millions of important letters arriving late' across the UK. The fine, the third of its kind against the postal service, follows a six-month investigation that found the company delivered only 77% of first-class mail and 92.5% of second-class mail on time in the 2024-25 financial year – well short of targets of 93% and 98.5%.
Ofcom described the persistent failures as 'unacceptable' and demanded Royal Mail urgently publish and deliver a credible improvement plan, warning that fines were likely to continue if no progress was made. The regulator noted that while the company had produced a plan for the previous year, there was no improvement. The penalty was reduced by 30% from £30m because Royal Mail admitted liability and agreed to settle.
Ian Strawhorne, Ofcom’s director of enforcement, said: 'Millions of important letters are arriving late, and people aren’t getting what they pay for when they buy a stamp. These persistent failures are unacceptable, and customers expect and deserve better.' He added that Royal Mail must rebuild consumers' confidence with actual improvements, not empty promises.
The fine comes amid broader changes for Royal Mail, including a £3.6bn takeover by Czech billionaire Daniel Křetínský’s International Distribution Services, completed in April after government approval. That same month, the price of a first-class stamp rose to £1.70, and second-class to 87p. In July, Ofcom gave permission to loosen the universal service obligation, ending Saturday second-class deliveries and reducing the service to alternate weekdays, though implementation is expected to take many months.
Royal Mail said it would continue to focus on improvements, including changes to recruitment and training, and additional support to delivery offices. A spokesperson stated: 'Where we have piloted USO changes, we can see that our model is working, with improvements in deliveries. This will help us deliver a modern, reliable and more financially sustainable postal service.'
