Royal Mail is very proud to provide the Universal Service and of the role we play in the economy. We make commerce happen by connecting companies, customers and communities across the UK.
The services used by small businesses are protected by law. The Postal Services Act 2011 and the EU Postal Services Directive 1997 require universal postal service prices to be affordable. Ofcom found in March 2013 that Royal Mail’s services were affordable to small and medium sized businesses. Ofcom said (in their report on the affordability of postal services, published 19 March 2013):
“The evidence we have collected indicates that universal postal services are affordable for both residential consumers (including low income and other vulnerable consumers) and businesses (including small and medium businesses) at current prices. We have reviewed the price changes that are due to take effect from 2 April 2013 (as announced by Royal Mail in March 2013), and consider that universal postal services will continue to be affordable following these changes”.
The prices of Royal Mail franking services used by business have lagged behind inflation for many years and continue to do so. Franking customers benefit from good value prices and significant discounts, saving more than 21 per cent on the price of a First Class letter and 34 per cent on the price of a Second Class letter.
Ofcom has set safeguard price caps on Second Class stamped mail, which also covers Second Class parcels up to 2kg. The safeguard cap is set for seven years, for letters it was set at 55p, rising in line with CPI. Ofcom is legally obliged to ensure an affordable postal service and can reintroduce regulation on any Universal Service product.