(MENAFN) Royal Mail has been hit with a $26.5 million fine after it failed to deliver nearly a quarter of first-class mail on time, according to reports. This penalty ranks as the third-largest ever imposed by the UK communications regulator, following an investigation into Royal Mail missing both first- and second-class delivery targets during the 2024/25 financial year.

Ian Strawhorne, director of enforcement at the regulator, commented: "Millions of important letters are arriving late, and people aren't getting what they pay for when they buy a stamp."

The postal service acknowledged the ruling and stated it will "continue to work hard to deliver further sustained improvements to our quality of service." In the 2024/25 financial year, Royal Mail managed to deliver 77% of first-class mail and 92.5% of second-class mail on schedule, falling short of the 93% and 98.5% benchmarks, respectively.

This represents the third time in recent years that Royal Mail has been penalized for delivery shortcomings, after previous fines of $7 million and $13.2 million. The regulator initially proposed a $37.8 million fine but reduced it by 30% due to Royal Mail admitting its failures.

The regulator warned that penalties will likely persist if Royal Mail does not present a "credible improvement plan." Despite publishing a plan last year aimed at reaching 85% first-class and 97% second-class delivery on time, the company’s efforts “have not materialised,” according to the enforcement director. He added: "Royal Mail must rebuild consumers' confidence as a matter of urgency. And that means making actual significant improvements, not more empty promises."

Investigations found that the company "breached its obligations by failing to provide an acceptable level of service without justification" and that measures taken to meet targets were "insufficient and ineffective." The fine reflects the "harm suffered by customers" due to the postal service’s underperformance.

Under the universal service obligation, Royal Mail is legally required to deliver letters six days a week and parcels five days a week to all UK addresses. Since July, some regions have only received second-class letters on alternate weekdays, a change suggested by the regulator earlier this year.

A spokesperson for Royal Mail said: "We acknowledge the decision made by Ofcom today and we will continue to work hard to deliver further sustained improvements to our quality of service." The company highlighted that reducing second-class deliveries in certain areas has allowed it to "drive a step change in quality of service" and added that enhancements in recruitment, training, and office support are underway.

MENAFN15102025000045017640ID1110200528