Stamp prices: First-class stamps to cost 60p

 
First-class stamps A first-class stamp currently costs 46p and a second-class stamp costs 36p

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A first-class stamp will rise in price from 46p to 60p from 30 April after the regulator lifted some price controls on Royal Mail.

A second-class stamp will go up from 36p to 50p - some 5p below the top price allowed by Ofcom.

The regulator has allowed Royal Mail to set the price of first-class and business mail.

It claimed the future of the universal service was at "severe risk" without relaxing controls.

The 30% price rise in first-class stamps, and 39% rise for second-class, mark the biggest annual increase in percentage terms since 1975. Ten years ago, a first-class stamp cost 27p, and a second-class cost 19p.

Over the next seven years, the price of second-class stamps will be capped at 55p but this limit could rise with inflation each year.

Royal Mail said that the cost of posting Christmas cards in 2012 will be the same as last year for consumers on Pension Credit and Employment and Support Allowance or Incapacity Benefit.

They will be able to buy up to three books of 12 stamps - 36 stamps in total - in one purchase from any Post Office branch from 6 November until the last posting dates before Christmas. Individuals must provide evidence that they are in receipt of these benefits.

Do members of the public know how much a first-class stamp costs?

'Severe risk'

Ofcom said that changes needed to be made to price limits, because the future of the UK's universal, six-day-a-week postal service was "at severe risk" as people switched to using text messages, e-mails, and online messaging.

After consultation, it has now confirmed plans to lift some of the price controls - a move recently backed by a committee of MPs.

The Commons Business Committee did raise concerns about vulnerable customers, and Ofcom said the cap on the cost of second-class mail was designed to protect this group of people.

Shortly after the announcement from Ofcom, Royal Mail announced exactly how much it will charge for stamps from 30 April.

Start Quote

No-one likes to raise prices in the current economic climate but, regretfully, we have no option”

End Quote Moya Greene Royal Mail chief executive

It announced:

  • The price of a first-class stamp for a standard letter will go up from 46p to 60p on 30 April
  • A second-class stamp for a standard letter will go up from 36p to 50p on the same date
  • A first-class stamp for a large letter weighing up to 100g will rise from 75p to 90p
  • A large letter sent second-class will cost 69p, rather than 58p
  • Parcels, franked mail, recorded post, redirection services and PO Box use will also be going up in price

Royal Mail's chief executive, Moya Greene, told the BBC that the one-price-whatever-the distance universal service was under threat because the organisation's financial situation had been "very fragile" for some time.

"In the core business in the past four years we have lost over a billion pounds," she said.

"No one likes to ask their customers to pay more, I certainly wouldn't do it, especially in these economic times, if it were not absolutely essential."

But she said there was "not an affordability issue" as stamps cost less than a chocolate bar.

Historical prices graphic
Controls

Ofcom said that the average household spent around 50p per week on post, with low-income families typically spending less.

The changes made by the regulator will mean:

  • Royal Mail, not the regulator, will set prices on the majority of products, including first-class and business mail
  • Second-class stamps must not be charged at more than 55p. This limit will rise in line with the Consumer Prices Index (CPI) measure of inflation for each of the next seven years
  • Small parcels and large letters weighing up to 2kg sent second class will also eventually have a price cap, but not in 2012-13
  • There will be some control of what Royal Mail can charge competitors to access its network

"Ofcom's decisions are designed to safeguard the UK's postal service, ensuring it is sustainable, affordable and high-quality, to the end of the decade and beyond," said Stuart McIntosh, of Ofcom.

"The measures ensure that Royal Mail's products remain affordable for vulnerable consumers and small businesses."

Targets

Royal Mail delivered 16 billion letters to around 28 million addresses last year. However, since 2006, there has been a 25% decline in postal volumes with further falls expected.

Letterbox Royal Mail said it wanted to ensure a service was available in all areas of the country

Ofcom, which took over regulation of the industry from Postcomm, said that Royal Mail might not be able to keep up with current standards without regulatory changes.

The regulator demands that Royal Mail targets a record of delivering 93% of first-class mail by the next day and 98.5% of second-class mail must arrive within three days of posting.

Royal Mail's letters business made a loss of £120m in 2010-11.

A Department for Business spokesman said: "Price rises are never welcome. However, ministers are clear that the top priority is to protect the universal service on which people rely.

"But this service comes at a cost, and its provider, Royal Mail, needs to be financially viable. The most important thing is to secure the universal service, but price rises are only one part of the story, the successful modernisation of Royal Mail is also crucial."

Up to 90% of Royal Mail can be sold, following an Act of Parliament last year.

This was most likely take place in the first quarter of 2014, probably through a sale of shares, according to chief executive Ms Greene.

Reaction

Sharon Little, chief executive of the Greeting Card Association, said more cards were sent per person in the UK than anywhere else in the world, but the change in prices was a "worry".

She said that the association understood the pressures on Royal Mail, but she called for the group to extend its price freeze this winter to all pensioners, not just those on certain benefits.

The majority of people, she said, sent their Christmas cards by second-class post, but birthday and mother's day cards tended to be send first-class.

Small businesses that made cards tended to sell upmarket products, so she hoped the increasing price of stamps should not affect these businesses too much.

Billy Hayes, general secretary of the Communication Workers Union, said: "Those people who baulk at the idea of stamp price rises should understand that it comes directly from government decisions to privatise this industry."

John Walker, national chairman of the Federation of Small Businesses, said: "With 84% of small firms dependent on Royal Mail, it is welcome news that they will receive discounts on some products.

"However, it does not go far enough. Rapidly raising stamp prices now will be bad for business. With small businesses and consumers being hit by other rising costs, this has come in at a time when they can ill-afford it."

Royal Mail price increases

Stamps Old price New price

Source: Royal Mail

First-class stamp

46p

60p

Second-class stamp

36p

50p

Large letter up to 100g: first-class

75p

90p

Large letter up 100g: second-class

58p

69p

Parcels

First-class up to 750g

£1.58 - £3.05

£2.70

Second-class up to 750g

£1.33 - £2.61

£2.20

Other

First-class 100g franked letter

39p

44p

Second-class 100g franked letter

28p

31p

Recorded signed for item

77p

95p

 

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  • rate this
    0

    Comment number 641.

    I doubt you could buy a packet of trendy crisps for 60p. So to post a letter one day, for the vast majority of the time it arrives at its destination the next day, for 60p? I think that's a bargain which ever way you dice it, just one thing though, posties, stop wearing shorts during the winter and smarten up a bit, apart from that its all good...

  • rate this
    +3

    Comment number 640.

    199 Jeff Davies, I think it is you who is completely out of touch. Whilst all price increases are regrettable, we have been under-paying for this service for years, and if we are to retain a postal service, prices have to go up. The only other option is to let it fail and then allow private enterprise to take over. Then you really will see price increases, and parts of the country not covered.

  • rate this
    +4

    Comment number 639.

    520.Tio Terry

    Its easy to point at pensions, the real cost of pensions for this nation is those that don't have them . . .

  • rate this
    +6

    Comment number 638.

    The price increase is a little steep but I can understand the necessity.
    I do wonder why those on various benefits get a cheap rate for Christmas though? Christmas cards are not a necessity and they already receive benefits the rest of us don't get. Will supermarkets start giving people 30% of a turkey if they can prove they are on some sort of benefit too? It seems a strange distinction to make.

  • rate this
    +1

    Comment number 637.

    200. ben_northeast
    2 HOURS AGO
    "Stop making excuses, like the telegram the letter is dead."

    Got the email address of your local tax office, utility company or anyone else you want to complain to have you? The letter is not dead, and in many parts of business, such as the legal profession, email is not an acceptable method of service as there is no proof of receipt.

  • rate this
    +2

    Comment number 636.

    "It may reduce the number of Christmas cards that are sent!"

    It will reduce the amount of post that is sent, and Royal Mail will be no better off than before the price hikes as customers desert them en masse.

  • rate this
    +2

    Comment number 635.

    This is the largest nail yet in the coffin of Royal Mail.

    Personally speaking this will devastate my eBay business.

    I don't expect European customers will touch me with a bargepole now, and I will have to drop from 1st to 2nd class for my UK customers meaning they get a worse service.

    I don't know what business model they are working from but I will be sending far less mail next year than last.

  • rate this
    +5

    Comment number 634.

    Whilst I think the price for the service is great, I question how much longer this service is required. A price increase will drive more people online and as has already been said Royal Mail need to be thinking about their longer term business model. Look at the music and game retailers and how they have all suffered since online took over. Post will eventually go the same way. Sad but true!

  • rate this
    +9

    Comment number 633.

    Now prices are going higher they should just have one class of normal stamp at say 55p, this would save loads of money in its self not having to sort a lot of the mail in to 2nd and 1st class .

  • rate this
    -1

    Comment number 632.

    Lol, seriously? Prices of such things are meant to DROP over time, not rise. We are going backwards in so many ways!

  • rate this
    +1

    Comment number 631.

    Its not a lot really. Hopefully wages can go up a bit for Post Office Workers. However, at risk of making myself unpopular, I have to say its not the answer to securing the future of the Post Office.
    Posting letters and various other means of communication has dwindled since the advent of the internet. The Post Office should have diversified into this area long ago.

  • rate this
    +3

    Comment number 630.

    For anything over large letter size it is now cheaper to use one of RM's rivals,not only that they will collect it from your home and deliver it without taking it back to the depot because it's I millimetre thicker than the limit.

    Bye Bye Post Office welcome RoyalsnailPLC Twice the price for hllf the service but at least the CEO will be paid millions.

  • rate this
    +2

    Comment number 629.

    @jnoviski
    @1941geordie, Labour all the way oh ad BTW its computer... not computor, and iPhone has no hyphen, just shows the competency of the tory's.

    @jnoviski. It's 'Tories' (capital letter as proper noun, no apostrophe). You also don't need a comma in front of a conjunction ! Maybe you should use the cheap postage time remaining to buy a grammar book ?

  • rate this
    0

    Comment number 628.

    The best part is for this vastly over-inflated fee, they still won't guarantee that the item that you send will reach it's destination in anything like a reasonable time.

    Last year, 2 weeks before the last Xmas post day, I sent 4 cards to 2 addresses, all collected from the same place...........3 were delivered over a month, the 4th never arrived. Then they want a 1500% premium for SD. Pathetic.

  • rate this
    +3

    Comment number 627.

    This equates to a 30% price rise for 1st class stamps and a 38% increase for 2nd class.

    And we get to fund their pension fund deficit.

    If I put my prices up by this amount I wouldn't have any customers left.

  • rate this
    0

    Comment number 626.

    Instead of dealing with the inefficient practices controlled by unions they have decided to squeeze 30% from their shrinking customer base.

    Maybe people living in rural areas should pay more and those of us in the cities can have a choice on who delivers out mail via a true open market.

    Won't be huge issue for me as I post about 10 letters a year!

  • rate this
    0

    Comment number 625.

    I think the price rise is far too muchof an increase in one year. I shall be buying all my first class & second class stamps I need for the rest of the year now, to avoid the additional cost this year. The stamps will still be valid.

  • rate this
    0

    Comment number 624.

    Ah, so this is how they will pay for the sweeping redundacies when the postal service gets privatised. Not as daft as we look.

  • rate this
    -1

    Comment number 623.

    Businesses with any reasonable volume will migrate to private mail services who all (at the moment) use RM for the final delivery. RM will be left with consumer / low volume users and their prices will discourage all but essential use. Great news for TNT, DHL etc.

    RM won't be privatised, too hot for politicians, they will just be squeezed out of the market.

  • rate this
    +1

    Comment number 622.

    What a farce. If the government hadn't flogged off all the decent routes to private companies a few years ago, leaving RM with the bits no one else wanted, this situation wouldn't be occurring. Since then it's been cuts all over in the postal service. Can't understand why, when more people buy online (delivered BY POST) RM think it's a good idea to kill that area off as well. Stupid idea.

 

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