UK govt rejects Royal Mail move to axe Saturday deliveries

The government has blocked Royal Mail’s plans to axe Saturday letter deliveries, it was revealed on Thursday, which could see the price of stamps increase even further.

Business minister Kevin Hollinrake confirmed the move in a letter to parliament's cross-party Business select committee. Royal Mail, owned by International Distributions Services has argued its business is unsustainable unless it is allowed to drop its six-day-a-week delivery obligation and claims customers no longer value Saturday delivery rounds.

“The ability to send and receive letters and parcels is important both socially and economically. This is particularly true for consumers who might be more vulnerable,” Hollinrake said.

The company is trying to pivot to focus on parcels amid the boom in online shopping in an attempt to return to profits. Any change would need a change in law.

Regulator Ofcom has estimated that cutting Saturday letter deliveries would save Royal Mail up to £225m per year.

Royal Mail’s chairman Keith Williams in December said that large rises in the cost of a first class stamp would be needed to if it has to continue with a six-day letter delivery service.

Reporting by Frank Prenesti for Sharecast.com