Second class Saturday letter deliveries could be scrapped under Ofcom review #UKFinance

Royal Mail could be allowed to ditch Saturday deliveries for second class letters under an overhaul of the UK postal service being considered by the industry watchdog.

Regulator Ofcom, which has been consulting on the future of the universal postal service since January, said it is now focusing efforts on changes to the second class service while keeping first class deliveries six days a week.

Under the plans being considered, second class deliveries would not be made on Saturdays and would only be on alternate weekdays, but delivery times would remain unchanged at up to three working days.

Ofcom said no decision had been made and it continues to review the changes, with aims to publish a consultation in early 2025 and make a decision in the summer of next year.

Royal Mail has urged the Government and Ofcom to review its obligations, arguing that it is no longer workable or cost-effective, given the decline in addressed letter post.

It has proposed ditching Saturday deliveries for second class post and cutting the service to every other weekday in its submission to Ofcom in April.

Lindsey Fussell, Ofcom’s group director for networks and communications, said: “If we decide to propose changes to the universal service next year, we want to make sure we achieve the best outcome for consumers.

“So we’re now looking at whether we can get the universal service back on an even keel in a way that meets people’s needs.

“But this won’t be a free pass for Royal Mail – under any scenario, it must invest in its network, become more efficient and improve its service levels.”

Royal Mail owner International Distribution Services (IDS), which agreed a £3.57 billion takeover by Czech billionaire Daniel Kretinsky in May, said “change cannot come soon enough” to the UK’s postal service.

Martin Seidenberg, group chief executive of IDS, said: “Our proposal for the future of the universal service has been developed after speaking to thousands of people across the country, and is designed to protect what matters most for customers.

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“It can be achieved through regulatory change with no need for new legislation.

“The universal service faces a very real and urgent financial sustainability challenge.”

The Royal Mail’s universal service obligation (USO) stipulates that it must deliver letters six days a week to all 32 million addresses in the UK for the price of a stamp, no matter where the letters are going.

When Ofcom first said it was considering cutting postal delivery days, it sparked an outcry, with ministers quick to dismiss any suggestion that the Government would sanction the scrapping of Saturday deliveries.

The six-day-a-week service is part of the universal service requirement stipulated by law under the Postal Services Act 2011.

But the current plans being looked at would not need a change in legislation, given Royal Mail would still be delivering first-class post six days a week.

Royal Mail said its proposals earlier this year to reduce all non-first-class letter deliveries – including second class and bulk business mail – would save it up to £300 million a year.

The group also said its plans would lead to “fewer than 1,000” voluntary redundancies with daily delivery routes cut by between 7,000-9,000 within two years.