Royal Mail’s universal postal service ‘unsustainable’ without reform – Ofcom

Cutting Royal Mail’s letter deliveries to five days a week or three are among options being put forward by the industry watchdog as it warned the universal postal service risks becoming “unsustainable” without reform.

Ofcom said Britain’s universal postal service “must modernise” as it outlined proposals for its overhaul following a review amid calls from Royal Mail to ditch Saturday letter deliveries due to slumping demand.

It said two main options being mooted, cutting the six-day a week service to five days or three, although this would need Government and Parliament to change current laws, with another proposal being to overhaul first and second class and business services.

This could see the introduction of a service where most deliveries take up to three days or longer, with a next-day service still available for any urgent letters.

Ofcom said Royal Mail could make cost savings of £100 million to £200 million if letter deliveries were reduced to five days; and £400 million to £650 million if reduced to three days.

Its savings could be up to £650 million it the large majority of letters were delivered within three days.