UK Royal Mail announces record 5p increase in stamp prices

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Friday, December 17, 2010

In the United Kingdom, the Royal Mail have announced that they will increase the price of first-class stamps by a record 5p on April 4, 2011. This means that they will now cost £0.46. The company have also confirmed that the price of second-class stamps will be concurrently increased by 4p, increasing their value to £0.36.

On November 8, The Postal Services Commission voted to allow the Royal Mail to perform these actions. At present, the Royal Mail lose 6.4p for every stamped letter delivered by them. These increases should allow the company to receive an extra £380 million in revenues per year.

Moya Greene, the chief executive officer of the Royal Mail, commented about this decision. "We have thought carefully about these increases as we are conscious of the difficult economic circumstances our customers are facing," she stated. "No-one likes to pay more and we regret having had to take these tough decisions on pricing. After these increases, we will continue providing value-for-money as our prices will still be among the lowest in Europe. We are investing heavily to modernise our operations, which is all about providing our customers with the services they need in today’s open, highly competitive postal marketplace. With the sharp declines in mail volume, our revenues are falling. That means if we don’t generate more income, we will simply not be able to keep funding our six-days-a-week collection, sorting, transport and delivery operation to the UK’s 28m homes and businesses."

The price of parcels that weigh below two kilograms will remain unaffected. However, if parcels are over two kilograms in weight, the price will increase by 8%. The minimum price for special deliveries will become £5.45, an increase of 40p. After 0830 local time, company mail collections will also come at a yearly charge of £210.

Below is a table providing information of what prices for standard, large and franked letters will be as of 4 April 2011, as well as details of what the increases in price are for the letters in comparison to their current value.

Type of letter 1st class price 1st class price increase 2nd class price 2nd class price increase
Standard letter £0.46 5p £0.36 4p
Large letter £0.75 9p £0.58 7p
Franked mail £0.39 3p £0.28 3p


Sources

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