Ofcom Fines Royal Mail £21 Million for Missing 2024/25 Delivery Targets

Key Takeaways

• £21 Million Fine: Ofcom fined Royal Mail £21 million for missing its 2024/25 delivery targets.
• Significant Shortfall: Only 77% of First Class and 92.5% of Second Class mail were delivered on time, far below targets.
• Repeat Breach: This is Royal Mail’s third consecutive failure, following fines in 2023 and 2024.
• Regulatory Warning: Ofcom ordered Royal Mail to publish a credible improvement plan or face more penalties.
• Stricter Standards: New rules require 99% of mail to be delivered within two days to improve service reliability.

Deep Dive

Ofcom has fined Royal Mail £21 million after the postal operator once again failed to meet its statutory delivery targets for First and Second Class mail during the 2024/25 financial year.

The regulator found that between April 2024 and March 2025, Royal Mail delivered only 77% of First Class mail within one working day and 92.5% of Second Class mail within three working days, well below its required targets of 93% and 98.5%, respectively. Even after accounting for exceptional weather events such as Storm Darragh and Storm Eowyn, Ofcom concluded that Royal Mail had breached its obligations and failed to provide an acceptable level of service.

This marks the third consecutive year that Ofcom has fined Royal Mail for similar performance failures. The company was fined £5.6 million in 2023 and £10.5 million in 2024 for missing its delivery targets.

“Millions of important letters are arriving late, and people aren’t getting what they pay for when they buy a stamp,” said Ian Strawhorne, Ofcom’s Director of Enforcement. “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.”

Regulator Warns of More Penalties Ahead

Ofcom has ordered Royal Mail to publish a credible improvement plan and begin delivering measurable progress or face continued penalties. The regulator noted that Royal Mail’s 2024/25 plan, which aimed to achieve 85% for First Class and 97% for Second Class deliveries, fell short, and “has not materialized.”

Ofcom said the £21 million fine was reduced from an initial £30 million to reflect Royal Mail’s cooperation and admission of liability. The penalty will be paid in full to HM Treasury.

In determining the fine, Ofcom considered the impact on customers and the company’s financial position. Royal Mail recorded losses of £419 million in 2022/23 and £348 million in 2023/24, before returning to a modest £12 million profit in 2024/25.

Changes to Postal Obligations

In July, Ofcom updated the obligations imposed on Royal Mail to make its service more sustainable and responsive to public needs. Under the new enforceable backstop targets, 99% of mail must be delivered no more than two days late, addressing widespread complaints about letters taking weeks to arrive.

Ofcom said it expects Royal Mail to implement these new requirements effectively and improve delivery reliability. Without significant progress, the regulator warned that fines “are likely to continue.”

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