Royal Mail slapped with huge fine for missing targets as ‘millions of letters arrive late’

Royal Mail has been fined £21 million by regulator Ofcom for missing its annual first and second class mail delivery targets, leading to millions of late letters across the UK.

This marks the third-largest fine ever imposed by the communications watchdog. Ofcom found that in the 2024-25 financial year, Royal Mail delivered 77% of first class and 92.5% of second class mail on time, falling short of its 93% and 98.5% targets.

It is the third year in a row that the British delivery giant has been fined for not meeting its service requirements.

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,” Mr Strawhorne added.

“If this doesn’t happen, fines are likely to continue.”

Ofcom said it considered the effects of exceptional weather events in its investigation, such as storms and floods, but found that Royal Mail still fell short of its delivery targets between April 2024 and March 2025.

The £21 million penalty was reduced from £30 million as a result of Royal Mail admitting liability and agreeing to settle the case.

The fine took into account the harm suffered by customers as a result of the disappointing service, and the fact that targets have been missed for three years.

It also considered Royal Mail’s financial position, with it having recently returned to an annual profit.

A spokesperson for Royal Mail said: “We acknowledge the decision made by Ofcom today and we will continue to work hard to deliver further sustained improvements to our quality of service.

“A key area of focus and investment has been the detailed work ahead of full implementation of our new delivery model, enabled by Ofcom’s changes to the universal service.

“This is critical to enable us to drive a step change in quality of service.

“We have also implemented important changes across our network including recruiting, retaining and training our people, and providing additional support to delivery offices.”

The company added that trials of the universal service changes were “working, with improvements in deliveries” in parts of the UK.

Ofcom gave the green light to Royal Mail to scrap second class letter deliveries on Saturdays and change the service to every other weekday, with the changes being rolled out in the coming months.

But under its universal service obligation, Royal Mail must keep Monday to Saturday deliveries for first-class post and maintain the target for second-class letters to arrive within three working days.