Royal Mail is being investigated by the industry watchdog after it failed to meet its delivery targets over the past year.

Ofcom said it would consider whether any exceptional events explained why Royal Mail fell short.

But, if there were no satisfactory explanation, the regulator said it would consider imposing a fine.

The postal service delivered only 73.7% of first-class mail within a day - far short of the 93% target.

Ofcom said the impact of Covid was no longer "an excuse for poor delivery performance".

The BBC says that, if Royal Mail is fined, it would be its second penalty since 2019 when it paid out £1.5million for failing to deliver first class letters on time.

Second-class mail target missed

A quality-of-service report from Royal Mail also showed it delivered only 90.7% of second-class mail within three days, below a target of 98.5%.

A spokesperson for Royal Mail said it was "disappointed" with its performance, adding: "We will participate fully with any Ofcom's investigation."

On Friday, the company's CEO Simon Thompson announced that he would leave, meaning the company will soon be searching for its third boss in five years.

Royal Mail said its services had been affected by 18 days of strike action and that high levels of staff absence continued to hamper operations.

It said it hoped an agreement reached last month with Communication Workers Union would resolve the matter and allow it to "rapidly improve" its services.

Royal Mail's chief operating officer Grant McPherson apologised to customers who were affected by the missed targets, but added the past year had been "one of the most challenging in [Royal Mail's] history".

Further progress

"With the plans we have in place to drive service levels and reduce absence, we hope and expect to see further progress in the coming months," he said.

Royal Mail has previously said the strike action was costing £200million and could threaten its survival. In addition, in January the firm faced a ransomware attack which disrupted overseas mail for more than a month.

In March MPs on parliament's Business, Energy and Industrial Strategy Committee referred Royal Mail to the regulator following claims the firm was prioritising parcels over letters.

Royal Mail must, by law, deliver letters to all parts of the UK, six days per week, as part of its "universal service obligation", and prioritising parcels risked that, MPs said.

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