Royal Mail to cut as many as 6,000 jobs as losses rise

Royal Mail is set to cut as many as 6,000 jobs over the next year and there could be more redundancies ahead as the industrial dispute gripping the company shows no sign of easing.

The company’s chief executive, Simon Thompson, told The Standard that the cuts would not affect the frequency of London’s daily post.

““There is no plan that we have in regard to stopping the daily delivery of letters in London.”

He added that the company did not regret its requirement to provide the UK’s nationwide postal, the so-called universal service obligation, and that it was positive for the company. .

“We have always been proud to be the USO provider and actually a combined delivery of letters and smaller parcels is a good competitive advantage.”

He added that the job cuts announcement today “is not about letters, it’s about parcels. More of our revenue is coming from parcels and that is the competitive part of the market. Back in 2005, we used to deliver 20 billion letters a year, now we are at round 8 billion. We are now a parcels business that also delivers letters.”

Yesterday, postal workers at Royal Mail launched a 24-hour strike in a dispute over pay and conditions. The Communication Workers Union (CWU) said the move would be the first of 19 days of strike action in the run up to the Christmas period.

In a statement, Royal Mail said: “We will be starting the process of consulting on rightsizing the business in response to the impact of industrial action, delays in delivering agreed productivity improvements and lower parcel volumes.”

It comes as the delivery business reported an operating loss of £219 million for the first half of the year, with an expected full-year loss of £350 million. Royal Mail shares tumbled 10% to 188p in early trade.

CWU general secretaery Dave Ward said: “Postal workers face the biggest ever assault on their jobs, terms and conditions in the history of Royal Mail.

“The public and businesses also face the end of daily deliveries and destruction of the special relationship that postal workers and the public have in every community in the UK.

Royal Mail said its full-year losses could widen to as much as £450 million if customers switched to using other delivery firms in response to the industrial action. The company warned further strike action could “necessitate further operational structuring and headcount reduction.”