People receiving benefits may soon enjoy reduced prices for postage stamps as part of new proposals under consideration by Ofcom. The regulatory body is exploring the introduction of a discount program akin to existing social tariffs that provide discounted mobile and broadband services for benefit recipients.
Over the past four years, the cost of first-class stamps has surged from 85p to £1.70, while second-class stamps have increased from 66p to 87p during the same period. Ofcom has initiated a review seeking public feedback until December 5, 2025, with plans to release a consultation in early 2026. Royal Mail holds the authority to set stamp prices in the UK.
In response to the review, a Royal Mail spokesperson expressed willingness to collaborate with Ofcom, emphasizing their commitment to balancing competitive pricing with the rising expenses associated with maintaining the Universal Service. The spokesperson highlighted the intricacies of mail delivery, involving a vast network of transportation methods and thousands of postal workers handling deliveries across the UK.
In recent developments, Royal Mail faced a £21 million fine for failing to meet annual first and second-class mail delivery targets. Ofcom’s findings revealed that during the 2024/25 financial year, only 77% of first-class mail and 92.5% of second-class mail were delivered on time, marking the third consecutive year of penalties for service non-compliance.
Notably, Ofcom has approved Royal Mail’s plans to discontinue Saturday deliveries for second-class letters, transitioning to alternate weekday services in the upcoming months. However, Royal Mail remains obligated to maintain Monday to Saturday deliveries for first-class mail under the universal service mandate, with second-class letters expected to arrive within three working days.
Martin Seidenberg, the CEO of International Distribution Services (IDS), acknowledged the substantial challenges ahead and emphasized the importance of a meticulous approach to ensure customer satisfaction. Despite progress, Royal Mail reported underlying earnings of £12 million for the year ending March 31, representing a significant improvement from the previous year’s losses of £336 million. However, when factoring in voluntary redundancy costs, Royal Mail still recorded underlying operating losses of £8 million.
The ongoing developments in the postal service sector suggest a period of transition and adaptation for Royal Mail, with a focus on enhancing operational efficiency and meeting service standards while navigating financial complexities.
