Royal Mail has scaled back planned price increases for NHS hospital letters and bank statements following opposition from third-party logistics firms. The postal operator initially proposed raising fees charged to logistics companies responsible for collecting and sorting bulk mail by 25%, with the increase scheduled to take effect in October. This hike was to follow an earlier 9% rise implemented in January.

After protests from logistics providers, including members of the Mail Competition Forum such as Whistl and UK Mail, Royal Mail has revised the proposed increase down to 18%, now set to start in December. The decision follows the involvement of the communications regulator Ofcom, which has committed to assessing whether the proposed price rises are “fair and reasonable” within the next four months.

Royal Mail’s leadership expressed concern that a protracted Ofcom review could have significant financial implications, prompting them to reduce the planned increase to resolve the dispute. However, it remains uncertain if the Mail Competition Forum will accept the latest 18% rise or seek further regulatory intervention, which could trigger another review. The Forum has previously described Royal Mail’s price adjustments as “excessive” and criticised the company’s delivery performance as “abysmal.”

The disagreement pertains specifically to wholesale mail services, which include NHS correspondence, energy bills, and bank statements. These bulk mail costs are distinct from consumer postage rates, which have risen substantially in recent years. For instance, the price of a first-class stamp nearly doubled to £1.80 in April compared to 2022 levels.

Royal Mail has faced increasing scrutiny regarding its service quality amid reports of NHS letters arriving after patients’ appointments and delays in billing that have occasionally led to late-payment fees. The company has also been subject to multiple fines for failing to meet delivery targets, including a record £21 million penalty last year.

A Royal Mail spokesman noted that the delay in raising prices on access business customers negatively affects the “financial sustainability of the universal service,” underscoring the need for adjustments to take effect in December. The ongoing negotiations highlight the tensions between controlling costs for public service mail and maintaining a viable postal network amid mounting operational challenges.