Review of the second class safeguard caps 2024: Citizens Advice’s response to Ofcom’s consultation

Review of the Second Class Safeguard Caps 2024 577 KB

Addendum to Citizens Advice’s response to Ofcom’s consultation 434 KB

Consumers across the country rely on letters for vital information, such as legal matters, financial information, bills and medical documents. And people can’t shop around for letter postage - they’re all subject to Royal Mail’s prices. That’s why we need Ofcom to make sure postal services are affordable, accessible and reliable for everyone.

Citizens Advice welcomes Ofcom’s proposal to keep a cap in place for letters. It’s positive that the regulator has recognised letter consumers need protections. But despite this, we have concerns about several aspects raised by the consultation.

Specifically:

● A “targeted” stamp scheme: We disagree with developing a targeted stamp scheme at the expense of universal protection, potentially leaving millions missing out on protection.

● Transparency: In a market where people can’t shop around, letter consumers need clear information about price increases. It would be simpler and fairer for consumers if Ofcom set the price cap for each letter product.

● Parcels: We’re disappointed to see the proposal to remove safeguard caps on second class parcels up to 2kg. This could lead to consumers that rely on offline purchases being changed more, especially in rural and remote areas.

The past few years have been challenging for consumers. And household incomes won’t recover much, if at all, throughout the next review period. In this environment, regulators should be doing all they can to support consumers. In the telecoms market, Ofcom has committed to putting more pressure on companies to drive awareness of social tariffs - only 5% of eligible households are benefitting so far - and is also reviewing the practice of companies charging above-inflation price increases in the middle of contracts. Ofcom’s postal team should also do all they can to support consumers across the country. Keeping the caps for both second class parcels and letters would make an important contribution to keeping basic post products affordable for everyone. Ofcom should also consider a 1-year temporary freeze on CPI increases to support consumers further.