An entire museum in London is dedicated to celebrating the 500-year-long history of British postal services. Yet that history is becoming an increasingly sorry tale.
Royal Mail, the official postal service of the United Kingdom, cannot deliver letters and parcels on time, according to the country’s communications regulator. Ofcom fined the company £5.6 million ($6.9 million) Monday for failing to meet its own delivery targets during its latest financial year, which ended in March.
“Royal Mail’s role in our lives carries huge responsibility… The company’s let consumers down, and today’s fine should act as a wake-up call — it must take its responsibilities more seriously,” Ofcom’s director of enforcement Ian Strawhorne said in a statement.
It’s the latest blow to a troubled British icon, whose origins date back to the reign of King Henry VIII, remembered for sending two of his six wives to their deaths by beheading at the Tower of London.
Royal Mail has struggled with falling demand for parcel deliveries as hard-pressed consumers cut spending and as a surge in online shopping during the Covid-19 pandemic has faded. The pandemic also gave rise to serious operational challenges, as a result of the need for social distancing at local mail centers and delivery offices and high levels of Covid-related worker absences.
The business swung to a £1 billion ($1.2 billion) loss for the year through March 2023 after it was also hit by strikes. Royal Mail’s workforce has shrunk by 10,000 over the past year, as employees have retired or quit, or lost their jobs because of cuts to save money and “rightsize” the business.
Royal Mail’s parent company, International Distributions Services, blamed the poor service report from Ofcom on disputes with labor unions that led to 18 days of strike action. “Last year was uniquely challenging for Royal Mail,” the postal and delivery services group said in a statement Monday.
But even after adjusting for the impact of strikes, extreme weather and the closure of a runway at London Stansted Airport, Royal Mail still failed to meet its delivery targets by a “significant margin,” causing “considerable harm to customers,” Ofcom said.
“Clearly, the pandemic had a significant impact on Royal Mail’s operations in previous years. But we warned the company it could no longer use that as an excuse, and it just hasn’t got things back on track since,” added the Ofcom director Strawhorne.
It’s the second time in three-and-a-half years that Ofcom has fined Royal Mail for late deliveries. The company, which was privatized in 2013, has also been fined in the past for overcharging customers for stamps.
Shares in London-listed International Distributions Services fell 1% Monday. “We take our commitment to delivering a high level of service seriously and are taking action to introduce measures to restore quality of service to the level our customers expect,” the group said.
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