The chief executive of Royal Mail’s parent company has said it was “too easy to point a finger” at the delivery company over delays to postal votes, as it reported a rise in revenue helped by the general election.
The postal company’s owner, International Distribution Services (IDS), which is the subject of a £3.6bn takeover bid from a Czech billionaire, said letter revenues rose 11.2% in the three months to the end of June. Its sales rose on the back of record numbers of postal votes and higher stamp prices.
Deliveries of postal vote returns increased by 50% compared with the election in December 2019, and 30% more candidate mail was delivered than in the run-up to that poll.
Royal Mail was criticised before the election as concerned voters fretted over delays to their ballot papers. Some did not arrive in time before holidaymakers headed abroad and the then postal affairs minister, Kevin Hollinrake, claimed there was a “resourcing issue” in Royal Mail.
At the time, the company denied there was a backlog in postal votes and said it was delivering the ballot packs as soon as they arrived in its network from local councils.
Martin Seidenberg, the group chief executive of IDS, said it was “probably worthwhile reviewing the processes and procedures” around elections.
He cited the surprise short timeframe between the former prime minister Rishi Sunak calling the election and Britain going to the polls, and the time taken to print materials.
Seidenberg said: “You can’t really point a finger at just one or two [things] … it’s been a combination. What we got, we delivered – it’s too easy to point a finger just at Royal Mail.” He added: “If there will be an independent investigation, we will support it.”
The delays even raised the prospect of close results in constituencies being challenged in the high court because of delayed postal votes.
On Thursday, Royal Mail said 7.3m completed postal votes had been posted. It delivered 50.8m polling cards, and 184m pieces of candidate mail. However, excluding election mail, letter volumes fell 4%.
Seidenberg said: “I am proud and thankful for all the extra effort our postmen and women put in to play our part in delivering democracy.”
The company’s revenues were also boosted by an increase in stamp prices. In April, the price of a first class stamp increased by 10p to £1.35, with second class rising from 75p to 85p.
IDS group revenues rose 8.2% to £3.3bn in the first quarter of its financial year, with Royal Mail making a £2bn contribution, up 10.6%, and a further £1.3bn deriving from its international parcels arm, GLS, a 4.8% increase.
The financial update comes as the Czech tycoon Daniel Křetínský progresses his bid to take IDS private, 11 years after Royal Mail was turned into a listed company under the coalition government.
Křetínský, IDS’s biggest investor, has faced questions over his long-term intentions for Royal Mail and the dealings of his longtime business partners.
The low-profile energy tycoon, who also owns stakes in the football club West Ham United and the supermarket chain Sainsbury’s, this week told the BBC he would honour a commitment to deliver the universal service obligation (USO) “as long as I live”.
On Thursday, the company set up to acquire IDS said it was “fully committed” to the statutory obligation, and supported a proposal by Royal Mail to pare back second class deliveries to every other weekday. It has also agreed with the government not to sell Royal Mail or GLS for at least three years.
Asked whether he trusted Křetínský, Seidenberg said: “I have had some endeavours with him as part of him being an investor and [the bid] does sound genuine to me.”
As politicians appeared in front of the inquiry into the Horizon IT scandal, Seidenberg said: “I feel very sorry for what happened there, because it’s personal tragedies behind it.”
The Post Office was part of Royal Mail Group when the Horizon scandal began but was spun out in 2012. Seidenberg said many customers did not realise they were now separate entities. “We’re not happy with such a strong connection at this point in terms of recognition. This will only be something you can deal with over time.”
