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60p first-class stamps!? Royal Mail can set its own prices

Royal Mail is now free to set its own first-class stamp prices. The regulator Ofcom says this action is needed to save Royal Mail’s universal service, but does this have your seal of approval?

We’ll soon find out what Royal Mail’s new freedom will mean in practice. From 30 April the price of a first-class stamp will rise from 46p to 60p. That’s quite a jump, and a record annual rise.

The price of a second-class stamp will also go up, from 36p to 50p. Ofcom has set a cap for second-class stamps at 55p – meaning Royal Mail has packaged it a little bit lower. Plus, this limit could rise with inflation every year.

Sending a large letter will cost 90p (instead of 75p) to post first-class, and 69p (rather than 58p) to send second-class. Parcels and everything else will also go up in price.

Higher prices to save Royal Mail

So, with relaxed controls come higher prices. Moya Greene, Royal Mail chief exec, has said this is needed to protect Royal Mail’s countrywide service:

‘No-one likes to raise prices in the current economic climate but, regretfully, we have no option. Royal Mail provides one of the highest quality postal services in Europe for among the lowest prices.’

There’s no getting away from the fact that people are sending less mail, but the fear is that higher prices will further add to this trend. Ofcom says the average household only spends about the price of chocolate bar (50p) on post per week. And even though Royal Mail delivered 16 billion letters last year, it’s still a loss-making business (£120m lost in 2010-11).

Your Royal Mail views

On Twitter, Dan ‏(@danthegooner) told us he doesn’t think the service is up to scratch:

‘Different postman every day if/when they turn up and numerous “lost” parcels. Never send via Royal Mail if I can. Rather use a courier.’

However, Craig (@craigpberry) thinks the new prices are worth it:

‘60p is hardly expensive! This is a sensible move. Buy cheaper birthday cards if 14p is going to break the bank.’

Almost three quarters of those who voted in our Which? Convo poll said they were against Royal Mail being given the freedom to set its own prices. Commenter Jon Large explained why:

‘I don’t think they should until there’s easier access for the general public to competitors services.’

And Peter Millard thought higher prices would results in fewer people posting letters:

‘Surely, putting up the price of a shrinking service is only going to make the demand for the service even less? Does there not need to be a reduction in prices in order to attract customers?’

As for me, I do still enjoying receiving mail (as long as it’s not junk or bills) but I have had my fair share of bad Royal Mail experiences. The latest was being asked to pay £1.12 for a letter that had been underpaid by the sender – I coughed up the money and the letter arrived ripped in half inside an ‘apology’ bag. I’d have preferred if Royal Mail had left it at the depot.

Still, that’s one case in hundreds of perfectly and promptly delivered post – and maybe it’s worth paying Royal Mail 60p to deliver them?

Comments
MAGGIE F says:
31 March 2012

1 am fairly happy with my delivery in derry both with my regular delivery man and in the quick receipt of parcels.I dont agree with such a hike for first class mail and try to contact people who have e mail and use it to give them my news ,otherwise i use 2nd class post if letter not urgent..

michael oldham says:
31 March 2012

sooner privatised the better this will weed out all the superfluous labour and over administration costs and give us all an improved and cheaper service.

what a ridiculous assertion – has this happened with any other service that has been privatised? in a word..no!

Andreas says:
31 March 2012

Now with costs of 1st class stamps raising to 60p, I will think about alternatives for posting my letters. Can Which? give an overview about alternative services and their quality?

Having waited to post a birthday card first class for delivery in the same town that it was posted and taking 6 days for delivery is not worth the higher price. I will deliver it myself next time.

The parcel mail has recently been delivered by the usual post man deliverer,but prior to the new post man any parcels due for delivery from a van had a card pushed through the letter box stating I was out and the parcel could not be delivered. I WAS IN THE HOUSE ON EACH OCCASION. How many times do I have to go to the post office collecting the parcel with no where near to the office to park. I am disabled.

elizabeth ashton says:
31 March 2012

Since December I have sent three letters first class which have arrived later than others sent at the same time by second class. One, a Christmas card containing a voucher never arrived at all!
Am not optimistic that the increase in price will mean a better service.

Margaret Anderson says:
31 March 2012

I send all my mail 2nd class and allow a week for delivery, only use first class if I have no alternative
sooner we get competition in the better

a 30% increase (in the first class rate) is simply not justified, no matter how long it has been since the last one. shame on royal mail!

Eric Gendle says:
31 March 2012

How can Royal Mail, which offers a uniform pricing system (from Scilly to the Shetlands) compete with the low cost specialist services such as UK Mail which only deal in bulk commercial mail. If they had to offer a similar universal service, what would they charge? Can someone explain how the system works, when Uk mail is delivered by the local postman, is the Royal mail forced to deliver these letters?

Fully agree, Royal Mail has to provide an Universal service for everyone.
The alternatives can cherry-pick the cheap to deliver items and dump the rest on Royal Mail.

Tony Johnson says:
31 March 2012

Whilst accepting the need for any business to make a profit rather than merely to break even, I don’t agree with the CEO that the service is improving. Deliveries – now once a day – are as late as lunchtime and collections are earlier – in the case of my local box – was 18.30 and is now 16.00. No longer even a limited Sunday collection. City centre sorting office now closed – modern building but not fit for purpose – Royal Mail’s fault, not the customers – last collection from main sorting office used to be 22.30 outside L postcode and 03.00 within it. Last collection is not from city centre – city centre collection is not made near a main road. New system operates from Warrington – first item (admittedly 2nd . class) via Warrington took three days to travel three miles as the crow flies. Fear Royal mail is on downward spiral through fax, mobile and internet alternatives.

Sue says:
31 March 2012

This will surely hit the pensioners again as they seem to be the generation that still communicate by letter. It will be cheaper for small businesses to hand deliver their local post rather than pay this increase and many larger businesses have already opted out of Royal Mail services. Personally I have had many letters taking much longer to arrive than they should and several letters have arrived that seem to have been tampered with. Having seen TV programmes of sorting office theft I certainly don’t blame the local postmen, many of whom have delivered the same round for years, but nobody in the Post Office seems to want to deal with the problem. Every year another increase and every year I post fewer letters. It is also cheaper to send many parcels by courier and this won’t help.

sue sharkey says:
31 March 2012

I think it,s a joke,£0.60 first class, post office is talking about closing our sorting office, so if we have to pick up a parcel it,s going to be awful going into the city center i will use email or phone in the future, it,s the postmen & women i feel sorry for, but i think this government arnt interested in the working class aslong as they live very confortable they will carry on taking from the working class children and pensioners.

I personnaly agree with the price rise as a realisted sign of the times and with the cost of fuel rising far higher than the rate of inflation. I recently had to post an inportant letter which cost me 60p for fisrt class, this didn’t bother me as long as it got there when i needed it to (i.e. within two days), if would have cost me far more money in fuel to drive to the destination 25 miles away and give it to the recipient. I think it’s a case now of paying for the service you want and if you get a good service most people would be happy to pay. Though i hasten to add that small businesses will be most affected.

Rufus says:
31 March 2012

I’ve deliberately reduced my “snail mail” over the last couple of years by using email as much as possible. It works, it’s quicker, more reliable, and free! All our Christmas cards went out with a subscription to Jacquie Lawson this year; saved a bomb. I shall now intensify my efforts. The Post Office has signed its own death warrant!

Mr George Atkins says:
31 March 2012

‘I will think very carefully what postage I use and send by e.mail where possible.
if I need to use Royal Mail it will be when e.mail will not be practical

jac says:
31 March 2012

well it would be nice if the post-person delivered letters to the right address , many times they get it wrong, that’s worrying .

Jan says:
1 April 2012

60p to deliver a letter anywhere in the UK … next day. Try asking one of the other next day delivery companies if they could do it for that.

OK, so one or two letters do take a little bit longer to arrive. And yes, one or two letters do get delivered to the wrong address occasionally. But we’re talking about thousands upon thousands of letters going through the postal system every single day, many with badly handwritten envelopes and the rival companies experience the same error rate but have to charge you much more for the privilege … so as a percentage the error rate is extremely low.

The post office & royal mail still provide extremely good value for money. Don’t let anyone try to convince you it would better off in private hands. Just accept that, as with everything else in life, you might just need to pay a little bit more for it now and then …

I agree 100% with Deanna’s and Jan’s comments above.
Once government departments and local authorities started sending out their bulk mailings via other operators the PO had one hand shoved up its back. Our local district council even had the hypocrisy to campaign about the closure of local post offices while biting the hand that feeds them through starving the Royal Mail of its traffic.

PaulaC says:
1 April 2012

I used to be a big fan of Royal Mail, but as they’ve shoved more unsolicited junk through my door (Royal Mail door-to-door, as we’re registered with the Postal Preference Service), left things on the doorstep, turn up at unpredictable times with no consistency of staff, bent cards, lost post, delivered things addressed to us next door and vice versa (including electoral roll registration forms), I just wish there was a reliable alternative that I wouldn’t mind paying for (60p is cheap for first class, if you trust the service). Having said that, I consider myself hugely lucky to have a local Post Office – the over-counter services (recorded delivery, proof of postage, etc) are really useful (although come to think of it I’ve even had first class recorded delivery take a week to make it from West Sussex to Hertfordshire!). From my perspective, our postal service has been badly mis-managed and I’m not convinced it can recover.

HEATHROWGUY says:
1 April 2012

seems everything is going this way, the effect on buisinesses may mean less junk mail, one can hope, proberbly will be cheaper to send leafleters on minimum wage, so why not open the competition whats to stop a group of newsagents getting together and providing a local postal service, and companies are already delivering parcels, what about milk floats delivering parcels – they are in most streets anyway, i suppose we have to change our ways.

As usual we think as islanders, isolated from the rest of the world. A rise to 60p is a lot but, if my information is correct, it is still only around half of the cost of the same service in Germany. I’ve just read a comment from a postman which sums it up fairly for me (and I’m not a postman). It’s a flat rate – it costs the same to deliver a letter within your own post code as it does to send one to the Shetland Islands. A load of absolute tosh is talked about junk mail. I’m prepared to accept the mild annoyance it causes ever since I came to realise that without it, Royal Mail could not afford to employ all the postmen and -women it does now. I value the services of our local postman and if it takes junk mail to keep him and other like him in a job, then so be it. I should add that I do not have the same regard for the militants of Mount Pleasant sorting office. The comments about competition from the private sector would have relevance if the paying fields were level but they decidedly are not even remotely level. The private firms in this sector can cherry pick what they bid for. leaving Royal Mail to pick up all the uneconomic postal activities. I’m a great believer in the principle of privatisation but I’m afraid that the principle is not always wholly borne out in practice is it so I’m nervous at the prospect of a privatised Royal Mail.