News and press releases

  • Royal Mail
    11 May 2018
    Royal Mail Quality of Service
  • Overall, Royal Mail missed its annual1 regulatory target for First Class mail, delivering 91.6 per cent the next working day, against a target of 93.0 per cent.
  • For Second Class mail, Royal Mail’s overall performance of 98.4 per cent was within the 98.5 per cent annual1 regulatory target range when allowing for the margin of error in sampling.
  • The Company notes that the full year outcome for First Class and Second Class mail was significantly impacted by a number of exceptional events. These factors included a very challenging industrial relations environment, some very severe weather, Cyber Week falling outside the exemption period and significantly reduced staffing levels caused by the Australian flu outbreak.
  • Royal Mail believes that, if the 2017-18 performance was adjusted for these factors, we would have achieved our First Class target. Royal Mail is asking Ofcom to take these issues into consideration.  It will be for Ofcom to decide.
  • During the fourth quarter of the year2, Royal Mail missed its quarterly Quality of Service target for First Class mail with a performance of 88.7 per cent. During the fourth quarter2, the Company also missed its quarterly target for Second Class mail, with a performance of 97.3 per cent.
  • Royal Mail has one of the highest Quality of Service specifications of any major European country.

Exceptional events

Our negotiations with the CWU on pensions, pay and working practices led to a very challenging industrial relations environment. This brought the Company to the brink of nationwide industrial action and the uncertainty impacted our operational performance. We avoided industrial action by working closely with the CWU through an external mediation process. This delivered an affordable and sustainable solution. If changes had not been made, the Company’s pension contributions would have more than doubled from around £400 million a year to over £1.2 billion a year, which was simply unaffordable.

In February and March 2018, the UK experienced some of the worst and most prolonged winter weather for many years. During this time, the Met Office issued two of its highest level Red Warnings for severe weather and also advised against travel. This came alongside several Amber and Yellow Warnings. It resulted in airport, rail and major road closures which heavily impacted our operational performance during the period.

Cyber Week is an increasingly significant part of the festive retail calendar, generating additional Christmas activity from both consumers and companies. The Christmas period3 itself has always been exempt from Quality of Service regulation because of the exceptionally high mail volumes. Cyber Week, by contrast, can fall within, or outside the exemption period. In 2017-18, all of Cyber Week - from Friday 24 November to Sunday 3 December 2017 – fell outside the exemption period. Another significant exceptional event was the Australian flu outbreak, which hit the UK in January 2018. It was described, in terms of hospital admissions, as the most significant flu season since the winter of 2010/11 by Public Health England. This resulted in a significant number of Royal Mail frontline staff going sick during the month.

These exceptional events had a negative impact on both our First Class and Second Class mail performance. The Company believes that if the 2017-18 First Class performance was adjusted for these factors, we would achieve the 93 per cent annual1 regulatory target for First Class mail. The Company believes that if the 2017-18 Second Class performance was adjusted for these factors, we would exceed the 98.5 per cent annual1 regulatory target for Second Class mail.

For 2017-18, at an individual postcode level4, 71 of 118 postcode areas met or exceeded their targets over the year. The Company believes that if the 2017-18 performance was adjusted for these exceptional issues, an additional 44 post codes would meet or exceed their targets. This would result in a total of 115 postcodes meeting or exceeding their targets, allowing for the margin of error in sampling.

Sue Whalley, Chief Operations Officer, Royal Mail said: “We are disappointed that we missed our annual1 regulatory First Class target. This was the result of several exceptional events that took a heavy toll on our performance during the year. Royal Mail has one of the highest Quality of Service specifications of any major European country and our postmen and women work extremely hard to deliver demanding targets. As we continue to work to increase efficiency in the business, we are committed to delivering high standards of service to all our customers across the UK.”

Royal Mail’s Quality of Service is measured by Kantar TNS5, an independent market research company. The latest independent report on performance was published today on Royal Mail’s website at: https://www.royalmailgroup.com/customers/quality-service/quality-service-reports

Ends

For further information contact:

Royal Mail Press Office: 0207 449 8246 (24 hours)

100 Victoria Embankment

London

EC4Y 0HQ

www.royalmailgroup.com
 

Notes to Editors

  1. 2017–18 financial year
  2. The latest quarterly report for the 2017-18 financial year covers the period from 2 January 2018 to 25 March 2018, inclusive for all services.
  3. Ofcom does not include the Christmas period in its annual Quality of Service measurement. This exemption recognises the significant increase in letters and parcels at Christmas. The current exemption runs from the first Monday in December to the first working day after the New Year public holiday in the following year. In 2017, Cyber Week fell on Friday 24 November to Sunday 3 December 2017. The exemption period began on Monday 4 December 2017.
  4. There are 121 Postcode Areas nationwide. All but three are set a minimum standard for First Class stamped and meter franked mail of 91.5 per cent. The three exceptions are Kirkwall, Lerwick and the Hebrides because of their remoteness.
  5. Royal Mail’s Quality of Service is measured independently by Kantar TNS, a company with a long track record in this field. The methodology used and the results obtained are audited and verified independently of Royal Mail and Kantar TNS by Ofcom appointed auditors. Royal Mail knows of no other measurement of its quality of service that gives results with the geographical coverage and degree of reliability and accuracy in the figures obtained by Kantar TNS. Over the 2017-18 financial year, Kantar TNS measured quality of service by sending more than 650,000 sample letters and parcels to nearly 6,600 addresses.

About Royal Mail plc
Royal Mail plc is the parent company of Royal Mail Group Limited, the leading provider of postal and delivery services in the UK and the UK’s designated universal postal service provider. UK Parcels, International and Letters (“UKPIL”) comprises the company’s UK and international parcels and letters delivery businesses operating under the “Royal Mail” and “Parcelforce Worldwide” brands. Through the Royal Mail Core Network, the company delivers a one-price-goes-anywhere service on a range of parcels and letters products. Royal Mail has the capability to deliver to more than 29 million addresses in the UK, six days a week (excluding UK public holidays). Parcelforce Worldwide operates a separate UK network which collects and delivers express parcels. Royal Mail also owns General Logistics Systems (GLS) which operates one of the largest ground-based, deferred parcel delivery networks in Europe.