Royal Mail fails to hit Ofcom delivery targets, prompting investigation

Communications regulatory body Ofcom has today announced that it is officially launching an investigation into Royal Mail as a result of it failing to meet its required targets for delivery performance, revealed this morning as it published its 2022-23 Quality of Service Report.

Ofcom rules require Royal Mail to meet specific targets, as the company is the designated universal service provider (DUSP). For 2022-23, Royal Mail had to deliver 93% of First Class mail within one working day of collection and 98.5% of Second Class mail within three working days of collection. Today’s Quality of Service Report revealed that both of these targets had been missed by a significant margin, with only 73.7% of First Class mail and 90.7% of Second Class mail arriving within the correct time frame.

In addition, the percentage of delivery routes completed on a daily basis was over 10% lower than targeted.

Data published by Royal Mail shows that Q3 was, without doubt, the company’s most challenging quarter for meeting these targets. Royal Mail was behind the target for First Class mail by 7.9% and Second Class mail by 2.4% in Q1 but in Q3 these targets were missed by 38.8% and 19.9% respectively.

Royal Mail’s Chief Operating Officer Grant McPherson said: “Improving quality of service is our top priority. We are committed to accelerating Royal Mail’s transformation and restoring service levels to where our customers expect them to be.

“We’re sorry to any customers who may have been impacted by our performance during a year that has been one of the most challenging in our history. With the plans we have in place to drive service levels and reduce absence, we hope and expect to see further progress in the coming months.”

In a statement accompanying the report, Royal Mail said: “The full year outcome on quality of service was materially impacted by the long-running industrial dispute with the Communication Workers Union (CWU) which included 18 days of strike action. High levels of staff absence continue to affect operational performance.”

As reported by Logistics Manager, Royal Mail and the CWU have now reached an agreement over pay and working conditions that has been ratified by the CWU’s Postal Executive Committee. The CWU will put the deal to a member vote over the next few weeks, with the final outcome of the ballot expected to be announced on 7 June.

Ofcom’s investigation will consider “exceptional events beyond the company’s control” when determining whether or not Royal Mail is in breach of its obligations. It will not accept the impact of Covid-19 as an excuse for this year’s shortcomings but it will likely assess whether the union dispute is a enough of a “satisfactory explanation” to save Royal Mail from financial penalties.

This news follows the announcement that Simon Thompson will step down as Royal Mail’s Chief Executive. Joining Royal Mail in 2017 and taking over his current role in January 2021, Thompson said that he believes “it is now the right time to hand over to a new CEO to deliver the next stage of the company’s reinvention”, moving forward after the agreement with the CWU.

Source: logisticsmanager.com

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