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(qlmbusinessnews.com Thurs, 25th Jan, 2024) London, UK —
“Royal Mail at a Crossroads: Proposals Surface for Radical Service Overhaul”
Proposals to revolutionize the Royal Mail service are on the horizon, with the potential for a significant reduction in delivery days from the current six per week to either five or even just three. The call for reform comes from a report by the regulator, Ofcom, which emphasizes the urgency of addressing the outdated nature of the postal service.
Ofcom suggests that the service could either cut down the number of delivery days or extend the duration it takes for most letters to reach their destination. Royal Mail acknowledges that its current delivery network is “not sustainable” and expresses the need for urgent reform.
The company, privatized a decade ago after its separation from the Post Office, is legally obligated to provide a universal service, delivering letters six days a week and parcels Monday to Friday. However, the drastic decline in the volume of posted letters, coupled with a surge in parcel deliveries, has prompted a reevaluation of the existing model.
The decline in Royal Mail's performance is evident, with customers frequently experiencing delays in receiving critical documents such as medical appointments and legal notices. Ofcom's chief executive, Dame Melanie Dawes, emphasizes the necessity of national discussions on reform options, with an update slated for the summer.
While Royal Mail suggests that its current delivery network is unsustainable, the government has indicated a reluctance to support the idea of scrapping Saturday postal deliveries. Kevin Hollinrake, the postal services minister, underscores the government's commitment to maintaining a six-day service, with Saturdays considered “sacrosanct.”
Ofcom estimates potential cost savings for Royal Mail, ranging from £100 million to £200 million annually for a five-day delivery week and between £400 million and £650 million for a three-day postal service. However, any reduction in delivery days would necessitate changes to existing legislation, requiring government and parliamentary involvement.
As the discussion unfolds, the future of Royal Mail's service model hangs in the balance, with potential reforms aiming to strike a balance between sustainability and meeting the evolving needs of customers.
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