Price of stamps due to rise again

Stamp prices increase

The Royal Mail is putting the price of stamps up at the end of this month, taking the cost of sending a first-class letter to 63p.

A second-class stamp will cost 54p, while the cost of sending a large letter first class will increase by 2p to 95p; 74p for second class.

And redirection charges are also increasing for both businesses and individuals.

Royal Mail says it's thought "carefully" about the increases, and has kept them as low as possible.

"We recognise how difficult it has been for householders and businesses in the recent tough economic conditions," it says in a statement.

"Royal Mail's stamp prices are among the best value in Europe. The European average for first class letters up to 100g is 72p. The UK first class stamp price remains well below this. The European average for second class letters, up to 100g, is 62p; the UK second class stamp price remains well below this."

There is better news for customers on parcel prices.

From 30 March, second class medium parcels weighing up to 2kg will cost £4.89 to send - a saving of up to £3.11. Currently, it cost £5.20 for parcels under 1kg, or £8 for one weighing between 1 and 2kg.

And Royal Mail has also decided to maintain the price it introduced for second class small parcels under 2kg as a Christmas promotion - £2.80.

In 2012, regulator Ofcom gave Royal Mail more freedom to set its own prices, although the cost of a second class stamp was capped at 55p linked to inflation for seven years.

It promptly upped the cost of a first class stamp by 30% - its biggest price rise for 37 years. When customers heard the increase was looming, they started buying up and hoarding stamps, leading to Royal Mail introducing a rationing system. Last year, it bumped up the cost of a first class stamp by 2p and a second class stamp by 3p.

Citizens Advice is concerned about the increases, and is calling on Royal Mail to focus on making efficiency savings rather than relying upon raising prices.

"We are concerned that stamp prices have risen above inflation and households and businesses using Royal Mail's redirection service will also face much larger costs," says chief executive Gillian Guy.

"When changing address, the redirection service is highly useful and helps to prevent identity theft and fraud. With Royal Mail the only firm that offers this service people have no choice but to pay the increased prices."

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