UK Royal Mail to put up stamp prices

Royal Mail is putting up the price of a second class stamp by 1p to 21p in April. The move will raise £70m to help fund the loss-making postal group’s three-year turnaround plan.

International mail prices will also go up next year, although first class stamps will stay at 28p. First class post for heavier items will fall by up to 10.8%, Royal Mail said.

The group said the rise was below the rate of inflation and stamps remained cheaper in the UK than in many other European countries.

Adam Crozier, chief executive, said the group’s universal postal service remained “fantastic value for money”. He added that the 1p rise in second class postage would help recoup some of the £257m Royal Mail lost providing this category of mail in the last financial year. About two-thirds of the 82m letters sent in the UK each day is sent second class.

The rise is in line with a formula unveiled in March by the regulator Postcomm, which controls Royal Mail’s price rises over three years.

But Postwatch, the consumer group, said although the rise had been expected it was unnecessary. Peter Carr, Postwatch chairman, said: “The price control agreed earlier this year was weak and over-generous.” Royal Mail is making progress in cutting costs, he added, and despite recent strike action is on course to make a full-year profit. “Customers should not be being asked to pay more,” Mr Carr said.

Meanwhile, Postcomm, confirmed that it would fine Royal Mail Pounds 7.5m for failings in its services to business customers. Royal Mail missed reliability targets in first class post paid impression and first class response services by about 6 per cent.

The regulator first announced it would fine Royal Mail in September, and no changes have been made following representations from the group.