- Royal Mail only delivered 77% of First Class mail and 92.5% of Second Class mail on time, well short of 93% and 98.5% targets
- Ofcom tells Royal Mail it must urgently publish – and deliver – a credible improvement plan, or fines are likely to continue
Ofcom has today fined Royal Mail £21,000,000 for failing to meet its First and Second Class delivery targets in the 2024/25 financial year.
This is the third time we have found the company in breach of its regulatory obligations in recent years, after we fined it £5.6m in November 2023 and £10.5m in December 2024.[1]
Ian Strawhorne, Director of Enforcement at Ofcom, 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.
“Royal Mail must rebuild consumers’ confidence as a matter of urgency. And that means making actual significant improvements, not more empty promises. We’ve told the company to publicly set out how it’s going to deliver this change, and we expect to start seeing meaningful progress soon. If this doesn’t happen, fines are likely to continue.”
How we measure performance
Ofcom measures Royal Mail’s delivery performance against nationwide annual delivery targets, from April to March. For 2024/25, the company was required to deliver 93% of First Class mail within one working day of collection and 98.5% of Second Class mail within three working days.[2]
If Royal Mail misses its annual targets, we can consider evidence of any exceptional circumstances beyond the company’s control – such as extreme weather – and whether it would have achieved its targets had those events not occurred.
What our investigation found
Even after accounting for exceptional weather events, Royal Mail only delivered 77% of First Class mail on time and 92.5% of Second Class mail on time between April 2024 and March 2025.[3]
We have therefore decided that the company breached its obligations by failing to provide an acceptable level of service without justification. It 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.
Financial penalty
As a result, we have fined Royal Mail £21,000,000, which will be passed in full to HM Treasury. This is the third largest fine Ofcom has ever imposed. It includes a 30% reduction from the £30,000,000 we would otherwise have imposed, reflecting Royal Mail’s admissions of liability and agreement to settle the case.
In deciding on the level of this fine, we have considered the harm suffered by customers as a result of Royal Mail’s poor service, and the fact that it has breached its obligations in three consecutive years. Ofcom also has a duty to ensure the universal postal service is financially sustainable, so we have also considered Royal Mail’s overall financial position, including its profitability and cash flow.[4]
Action to improve performance
As well as fining the company, we have been pressing Royal Mail regularly on what it is doing to turn things around. The company produced an improvement plan for 2024/25, aiming to achieve 85% for First Class mail and 97% for Second Class mail by March 2025. This would have amounted to significant improvement. However, this has not materialised.
This is unacceptable, and we have told Royal Mail it must urgently publish and implement a credible plan that delivers significant and continuous improvement. Without this, we are likely to continue to see financial penalties as both necessary and appropriate.
In July, we also made changes to the obligations imposed on Royal Mail – to reflect what people need, put the service on a more sustainable footing, and enable the company to invest more in improving its delivery performance. Royal Mail must now play its part by implementing this effectively and improving its reliability.[5]
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Notes to editors
1. We did not find Royal Mail in breach of its regulatory obligations in 2019/20, 2020/21 and 2021/22, due to the impact of the Covid-19 pandemic on the company’s operations, which was beyond its control.
2. The ‘Christmas period’ is excluded from the targets, which is defined as the period beginning on the first Monday in December and ending on the New Year public holiday in the following January.
3. Exceptional events we have considered are the two red weather warnings – Storm Darragh on 6 and 7 December 2024 and Storm Eowyn on 24 January 2025.
4. In 2022/23 Royal Mail made a loss of £419m, in 2023/24 it made a loss of £348m, and in 2024/25 it returned to a profit of £12m.
5. We also set the company new enforceable backstop targets so that 99% of mail has to be delivered no more than two days late, to address the issue many people have experienced where letters have taken weeks to arrive.