Denmark’s postal service is sending Royal Mail a chilling message...

Can anything save our posties from the same fate as the Danes, who are shutting their letter-sending operation? Answers on a postcard, please, says James Moore

PostNord, the Danish postal service, will cease letter deliveries from the end of the year. The Scandinavian nation’s red post boxes have already started to vanish and while private operators are expected to step in to the breach, the cost will inevitably be much higher.

This is the shape of things to come in Britain. Royal Mail, which is responsible for deliveries here, was allowed to hike prices in April to an eye-popping £1.70 for a first-class stamp (up 5p), and to 87p for second (up 2p). Two-thirds of Britons agreed that this was “unfair”.

In July, its universal service obligation (USO) was reformed, with Saturday deliveries of second-class post slated to be scrapped and weekday deliveries moving to Monday, Wednesday and Friday, or Tuesday and Thursday, in a two-week cycle. The (delayed) changes will take effect next year, while six-day-a-week deliveries remain for those who shell out for first class.

But for how long? Ofcom thinks that the savings to Royal Mail, now owned by Czech billionaire Daniel Kretinsky, from these reforms will be substantial – up to £425m a year. It also revised the company’s targets, to make them, in the view of the company (which has repeatedly been fined for missing them), “more realistic”.

However, it’s hard not to see letter deliveries entering a doom loop. Ofcom’s USO consultation was motivated by a sharp decline, from a peak of 20 billion letters sent in 2004-05 to 6.6 billion in 2023-24. That latter figure was down 9 per cent on the previous year.

“Royal Mail is going to be [the] provider of the universal service obligation in the UK unconditionally and, I would say, forever,” said Kretinsky in the run-up to his £3.6bn takeover of the business.

Things that make you go “hmmm”. One reason for the reforms was that Ofcom was genuinely concerned about the financial sustainability of the creaking, loss-making, letter delivery service.

We are not going to follow the Danes and PostNord just yet. But I would be very interested to see what the figures show in the wake of the price rises/service changes.

Far from sustaining the USO, they could catalyse its demise. Higher charges for a lesser service will inevitably lead people to consider whether they actually need to send that card or whether an email greeting will suffice, particularly in the midst of a cost of living crisis.

Grubbing up Britain’s beloved red post boxes would prove highly controversial (and that’s probably an understatement). Just the (necessary) changes to the USO provoked an outcry among consumer groups and unions.

A politically weak government, out of favour with an unhappy public it has clobbered with tax rises, wouldn’t dare allow such an unpopular move. We will not be following Denmark anytime soon, even if this Christmas proves a bust for deliveries. After all, 6.6 billion letters is still a lot and the same is true of 5.6 billion, or whatever the 2025-26 figure ends up at when Ofcom gets around to publishing the number.

So you can breathe easy. For now. But if I were working in this industry, I’d be watching like a hawk. There’s no such thing as forever in business and I suspect Kretinsky is well aware of that fact. The “Czech Sphinx” wouldn’t be a billionaire if he weren’t.

The end of the USO will have far-reaching implications. Some might prove favourable to the businesses involved. Let’s say a pricey special delivery service is retained through Post Offices (a separate business). This could prove quite lucrative. Perhaps they could serve as collection points for a streamlined letter delivery offering. That would surely help with footfall.

But some of the implications are more malign and go far beyond business. For example, it is often the postie who spots that something is wrong with the elderly customers they say hello to. Or they might notice an unexpected build-up of unopened mail at a customer’s home. This is as much social service as it is business.

Sure, parcel services will continue. But they are not daily for many people, especially older people, and they work on a very different dynamic. The conditions imposed on workers, who have only a minimal amount of time to make each delivery, don’t give them time to worry about anything other than getting to the next address as quickly as possible. Build-up of packages outside Mrs Miggins’s place? Someone else will sort it out for her.

Denmark taking this step now could ultimately prove to be useful. Other countries can watch and learn from its experience. It may not be a palatable message, but the organisations concerned – the Royal Mail, Kretinsky, connected businesses like the Post Office, and especially Ofcom – would be wise to do that.

It might be a decade or more before it happens here. But it will happen. Don’t believe me? Ask yourself when you last used a postbox. Then ask your digital native Zoomer friends/colleagues/kids the last time they did.