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December 10, 2013

Royal Mail Announce Stamp Costs

Filed under: Finance — Tags: — admin @ 12:51 pm

According to the Royal Mail, stamp prices are set to rise. As the current UK economy faces uncertain times, coupled both families and businesses struggling to make ends meet, is this really a good time for the Royal Mail to be hiking up their prices? Unfortunately, according to their chief executive, the decision to do so was inevitable.

So what will the new prices be? Well the Royal Mail have announced that prices will rise from the current 46p for 1st class stamps to 60p, and from 36p for 2nd class stamps to 50p. As a result, posting a large letter will increase from 75p for 1st class stamps to 90p and from 58p for 2nd class stamps to 69p. The changes will take effect from April 30th 2012.

With competition increasing, a declining volume of letters being sent and the threat of emails and other electronic messaging services, the decision for the price rise was unavoidable according to the Royal Mail’s Chief Executive, Moya Greene. She explained that in order for the organisation to restore their finances and maintain their universal service, they would need to increase their prices to stay competitive.

The Government back the Royal Mail’s decision, as they look to protect the UK institution. The decision for the increase follows the regulator Ofcom’s decision to allow the Royal Mail freedom to set their own prices.

Whilst the price increases are still relatively cheap in comparison with the rest of Europe, for example after the price rise, 2nd class stamps will still be the cheapest and 1st class stamps will be the 5th cheapest across Europe, families, businesses and consumer groups are still outraged. Consumer groups believe that the Royal Mail couldn’t simply rely on price rises to turn around its fortunes.

But what about the public and businesses who rely on the Royal Mail’s service? Well unfortunately, it’s yet another price rise that is increasing the financial burden on many up and down the UK. When you consider the sheer price hike that families have had to endure, such as fuel, bills, as well as the price of food, then you can see why many people aren’t exactly over the moon at this decision.

However, it appears that the Royal Mail have acknowledged the difficulties that many UK families may be suffering at the present time, which is why they’ve developed a ‘Christmas scheme’. This will allow families on low incomes, those on pension credits as well as those seeking employment and support allowance or incapacity benefits to be able to buy up to three books of 12 stamps at the 2011 prices.

Given the current state of the UK economy it appears this price rise will come at the wrong time for many in the UK. Whilst for the Royal Mail it isn’t serving their public image any good, they appear to have their hands tied as they too look to survive these uncertain economic times.

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