Royal Mail faces Ofcom questions over missed delivery targets
The postal regulator has launched an investigation into Royal Mail for missing its annual delivery targets, with almost a quarter of first-class mail arriving late.The company, which has been fined more than £16m in the last two years for failing to meet the delivery targets set by Ofcom, said 23.5% of first-class mail failed to arrive on time in the year to the end of March.This is a slight improvement on the previous year, when more than a quarter of first-class mail failed to arrive within the one-working-day target set by the regulator.Under the watchdog’s rules, 93% of first-class mail must be delivered within one working day of collection, excluding Christmas.
The latest delivery figures published by Royal Mail on Friday showed that it managed to deliver 92.2% of second-class mail within the three-working-day limit set by Ofcom.“We will investigate whether there are reasonable grounds for believing that Royal Mail has failed to comply with its obligations in 2024-25,” said a spokesperson for Ofcom.“If we determine that Royal Mail has failed to comply with its obligations, we will consider whether to impose a financial penalty.”In December 2024, Ofcom fined the company £10.
5m for failing to meet its delivery targets.The previous year, the postal regulator fined Royal Mail £5.6m for the same failure of its regulatory obligations.Alistair Cochrane, Royal Mail’s chief operating officer, admitted that the company’s quality of service was “not where we want it to be”.“We will continue to work hard to deliver the standards our customers expect,” he said.
“We are actively modernising Royal Mail, and while these efforts are beginning to deliver results, we know there is still more to do.”Last month, the Czech billionaire Daniel Křetínský’s EP Group completed a £3.6bn takeover of International Distributions Services, the owner of Royal Mail.Cochrane said Royal Mail would cooperate with Ofcom’s investigation but said the business was facing structural challenges and needed urgent reform of the universal service obligation to deliver at one-price nationwide six days a week.Earlier this year, Ofcom launched a consultation proposing that Royal Mail should be allowed to deliver second-class letters on alternate weekdays and to stop Saturday deliveries under changes to postal service rules.
Sign up to Business TodayGet set for the working day – we'll point you to all the business news and analysis you need every morningafter newsletter promotionOfcom said cutting the deliveries to every other weekday with a price cap on second-class stamps, while maintaining first-class letters six days a week, would still meet the public’s needs.Its provisional recommendations also included cutting delivery targets for first-class mail from 93% to 90% arriving the next day, and for second-class mail from 98.5% to 95% within three days.Ofcom said it estimated the changes would enable Royal Mail to save between £250m and £425m each year.Tom MacInnes, the director of policy at Citizens Advice, said: “ Our research has shown the damaging consequences of late post, like missed health appointments, fines, bills and vital government communications.
But with no alternative provider to choose from, people are forced to grapple with poor service, yearon year.“With Ofcom considering relaxing the current delivery targets set for Royal Mail as part of the universal service obligation review, reliability remains a huge concern.The regulator must get off the sidelines and make the company do what it should have been doing all along – giving paying customers the service they deserve.”
M&S contractor ‘investigating whether it was gateway for cyber-attack’
An Indian company that operates Marks & Spencer’s IT helpdesk is reportedly investigating whether it was used by cybercriminals to gain access to systems at the retailer, which is battling a devastating hack.M&S said this week that “threat actors” had gained access to the retailer’s systems through one of its contractors – understood to be Tata Consultancy Services (TCS).The clothing, food and homeware retailer confirmed the hackers used “social engineering” techniques to attack them, such as posing as a staff member to fool a helpdesk into giving away passwords.TCS, which has worked with M&S for more than a decade, has been helping the retailer with its inquiries into the cyber-attack, which began over the Easter weekend. The retailer said the attack could cost it up to £300m in profit
Sunny spring drives biggest jump in retail sales in Great Britain in four years
Sunny spring weather sent shoppers flocking to supermarkets and specialists such as butchers, bakers and alcohol outlets last month, fuelling the strongest quarterly jump in retail sales in Great Britain in almost four years.Retail sales volumes rose by 1.2% in April, well above City forecasts of an increase of between 0.2% and 0.4%, marking the fourth straight month of sales growth
UK private sector shrinking as firms cut jobs; pressure to raise taxes as government borrowing jumps – as it happened
Britain’s private sector is shrinking for the second month running as factory output falls at the fastest rate in a year and a half, a new survey shows.The latest poll of purchasing managers at UK companies found that private sector output is decreasing in May, although at a slower rate than in April.Manufacturing production fell at the fastest rate since October 2023, although this was moderated by a “fractional rise” in service sector output.UK firms reported that clients were cautious this month, due to business uncertainty, leading to a drop in new orders. However, worries about US tariffs have dropped this month, after Donald Trump delayed tariffs on America’s trading partners and agreed a trade deal with the UK
UK petrol prices poised to fall further as oil prices tumble
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Ministers said to be considering bill to wipe out British Steel’s debts
Ministers are reportedly considering legislation to relieve British Steel of debts that have risen to nearly £1bn, as the government considers how best to prepare the Scunthorpe steelworks for sale.The government took control of the business last month after it said its Chinese owner, Jingye Steel, planned to close the plant within days. The move required emergency legislation that was passed in a historic recall of parliament.Jingye remains the legal owner of British Steel, despite the takeover, and is owed money by the company. Those debts would probably have been wiped out in a liquidation
Government considers sale of Brexit border checkpoint in Kent – reports
The UK government is reportedly considering selling a post-Brexit border check facility in Kent that could fall out of use as a result of this week’s trade pact with the EU.The site, based in Sevington, Ashford, was erected in 2021 with capacity for 1,300 lorries that were expected to face extra checks on plants and animal goods, including dairy and meat, entering and leaving Britain after Brexit.However, the deal between the UK and EU struck earlier this week is expected to remove the need for routine health and veterinary certification on the import and export of farm products ranging from fresh meat and dairy products to vegetables, timber, wool and leather.The government is now looking for a company willing to buy or repurpose the Sevington border control point.Ministers are said to have approached Eurotunnel directly, according to the Financial Times
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