Ofcom proposes to cut second-class letter deliveries

Earlier this year Ofcom, the postal regulator, launched a consultation on the future of the Universal Service Obligation (USO). The Countryside Alliance responded to this consultation by stating that postal services and the USO are essential to those living and working in the countryside and that the Countryside Alliance believes Ofcom must retain the one-price-goes-anywhere service that Royal Mail provides and our members and rural communities value so much.

Ofcom has now released an interim report and their next steps. They have proposed that ending second-class Saturday deliveries could allow Royal Mail to improve service reliability, achieve significant cost savings, and redirect resources towards growing sectors like parcel delivery. Ofcom stated that Saturday deliveries were only necessary for sending the “occasional urgent letter or card.” It noted that for such urgent deliveries, most people would choose to use a first-class stamp, as the majority of letters are not time-sensitive.

Ofcom’s proposal could allow Royal Mail to improve service reliability, achieve significant cost savings, and redirect resources towards growing sectors like parcel delivery.

Earlier this year, Royal Mail also suggested revising the second-class service, which currently ensures delivery within three days to just three times a week, saying this would save it millions of pounds every year. Royal Mail said they would maintain a first-class post on Saturday.

Martin Seidenberg, chief executive of Royal Mail’s parent company International Distribution Services, said: “To save the universal service, we have to change the universal service.”

He said change could “not come soon enough”, adding: “Letter volumes have fallen from their peak of 20bn to just 6.7bn a year today, meaning the average household now receives just four letters per week. We look forward to continuing to engage with all our stakeholders to secure a financially sustainable universal service for many years to come.”

Ofcom is now going to carry out further in-depth research among postal users to assess whether to push ahead with the changes, which could take place without any update to legislation.

The Countryside Alliance has always supported the USO, particularly the one price to deliver to anywhere service but recognises times are changing and it is timely to review this obligation. However, we must ensure any new USO is fit for purpose and meets the needs of households and businesses in rural communities.

Read the Ofcom report on the future of the universal service agreement here.

Read the Countryside Alliance response to the Ofcom consultation here.