Price control

In March 2012 our new regulator, Ofcom, reformed the regulatory framework for postal services.

Ofcom decided to remove price control on the vast majority of Royal Mail’s products and services. Following the implementation of the new framework on 31 March 2012, the proportion of Royal Mail revenues under direct price regulation has been reduced to less than 10%.

Ofcom have decided to retain a price cap on a number of “safeguard” products. Stamped Second Class letters, Large letters and Parcels up to 2kg will continue to be subject to a regulatory safeguard cap. The safeguard cap will be in place for 7 years and increase in line with inflation, measured by CPI.

Pre-2012 framework

Historically, the majority of Royal Mail’s products and services were subject to price control. Price caps were set by our regulator, Postcomm, under a series of price control mechanisms in place from 2001 - 2011. More than 80% of our revenue was under direct price control. Over recent years there had been growing consensus that traditional price control has failed to secure the financial viability of the universal service.

You can find historical information and documents relating to the previous price-control framework below: