Royal Mail has urged Ofcom to rethink its decision to block the company from tracking packages under the Universal Service Obligation (USO) rules as strike action and delivery pressures loom.
It comes after the independent regulator said on Monday that it would not allow Royal Mail to track parcels as it could threaten competition in the market.
The post and parcel delivery firm has requested Ofcom u-turn on the move, stating that it needed to allow users to receive a minimum level of service at a reasonable price.
“Tracking is no longer seen as an optional extra or a premium offer, it is a necessity,” Royal Mail said in a statement.
“If regulation is a blocker to modernisation, it will increasingly put the finances of the universal service at risk.”
Meanwhile, a Ofcom spokesperson said: “As the universal service is VAT exempt, extending it to include tracking would provide Royal Mail with a financial advantage, harming competition.
“Royal Mail is free to offer tracked parcel services outside of the universal service requirements and outside of the VAT exemption, and in fact already provides such services.”
However, the news notably sits against a period of difficulty for the company.
Earlier this year, Ofcom launched an inquiry into the firm’s failure to meet delivery targets, which saw it miss first class targets by as much as 12 per cent, and second class by around three per cent.
Separately, the firm is awaiting news of potential industrial action, which could see as many as 115,000 workers go on strike this summer.
The total pay offer made by Royal Mail was worth up to 5.5 per cent, where two per cent was unconditional, and the remaining 3.5 per cent was subject to agreement on changes to improve productivity.
Royal Mail chairman Keith Williams told The Sunday Times that unions shouldn’t expect a no-string pay deal “where nothing changes”, as the firm balances dwindling productivity alongside rising union tension.
The union Unite called off its strike action earlier today which had been planned from Wednesday 20 to Friday 22 July.