You are here: Home - Household Bills - News -

Price of a 1st class stamp to rise to 85p

0
Written by: Emma Lunn
01/12/2020
Royal Mail blames the price hike on the coronavirus pandemic impacting operations.

The cost of a 1st class stamp will rise from 76p to 85p, a 9p rise, while the price of a second class stamp will go up by 1p to 66p, with the price hikes taking effect from 1 January 2021.

Royal Mail says the price hikes are necessary ‘to help ensure the sustainability of the one-price-goes-anywhere Universal Service’.

The Universal Service Obligation, which requires Royal Mail to be able to deliver to 31 million home and business addresses across the UK, comes with high fixed costs.

During the coronavirus pandemic, letter volumes saw a 28% fall. The reduction in letter volumes has had a significant impact on the finances of the Universal Service which lost £180m in the first half of the year.

Royal Mail says this demonstrates the need for change in the Universal Service and that it is ‘working tirelessly to deliver the most comprehensive service we can in difficult circumstances as the coronavirus pandemic continues to impact our operation’.

Royal Mail says it has faced significant, additional costs related to Covid-19 (£85m for the first six months) such as protective equipment, elevated absences, overtime and agency staff, as well as the impact of necessary social distancing measures.

Royal Mail hasn’t used the government’s furlough scheme throughout the pandemic.

It says its stamp prices are among the best value in Europe compared to other postal operators. Royal Mail research shows that the European average price for 1st class letters is £1.21.

Nick Landon, chief commercial officer at Royal Mail, said: “Like other companies, 2020 has been a challenging year for Royal Mail. Our people have worked tirelessly to keep the UK connected throughout the pandemic and associated restrictions. These price increases will help us continue to deliver and sustain the Universal Service in challenging circumstances.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

The savings accounts paying the most interest

If one of your jobs this month is to get your finances in order, moving your savings to a higher paying deal i...

Everything you need to know about being furloughed

Few people had heard of ‘furlough’ before March 2020, but the coronavirus pandemic thrust the idea of bein...

Coronavirus and your finances: what help can you get in the second lockdown?

News and updates on everything to do with coronavirus and your personal finances.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week

Read previous post:
EasyJet to cut free hand luggage allowance

From February, EasyJet passengers will only be able to take a single small bag which fits under the seat in...

Close