Royal Mail Hikes Postage Stamp Prices from January 1

The new year will bring an increase in the cost of first- and second-class stamps, the Royal Mail has announced.

A first-class stamp will cost 85p from January 1, a rise of 9p, while a second-class stamp will also go up in price by a penny to 66p.

Stamp prices were raised to their current levels in March 2020. Royal Mail said the latest move was necessary to help ensure the sustainability of the universal service and added that 2020 had been a ‘challenging year’ for the business.

The firm stated that due to the coronavirus pandemic it had considered any pricing changes very carefully’.

The latest price increase comes soon after the Royal Mail revealed letter volumes had fallen 28% in the six months to September 27, when compared to the same period last year. For the first time ever, revenue from parcel deliveries outweighed letters, which was fuelled by the increase in online shopping over the lockdown periods.

Royal Mail commented “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.

“This demonstrates the need for change in the universal service. We are working tirelessly to deliver the most comprehensive service we can in difficult circumstances as the coronavirus pandemic continues to impact our operation.”

In a bid to defend a rise in postage stamp costs, the company said that the global pandemic had cost it  an additional £85m during the period, which was used to provide protective equipment, cover absences, overtime costs and agency staff fees.

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.”

The price hike comes a week after the regulator Ofcom said that Royal Mail would be able to cut Saturday letter deliveries and still meets the needs of most customers.