The Royal Mail has said it will need to raise prices and cut costs in the face of rapid inflation.

The company warned it sees “significant barriers” to rising costs, including wages, energy and fuel.

Royal Mail revealed that it seeks to save £ 350 million over the current fiscal year by trying to strengthen its position, but did not say whether the plan would jeopardize jobs.

Inflation is going on across the UK economy.

The consumer price index has hit the highest level in 40 years in April, it was announced on Wednesday when the cost of living crisis worsened.

The Royal Mail already has increased the cost of sending letters on average about 7%, and parcel prices average about 4%.

Increase the value of a first class stamp to 95 pence and a second class stamp to 68 pence.

But he sees many threats from rising costs ahead, including an inability to negotiate pay with the Communications Workers Union (CWU), which opposes measures the company wants to implement as part of its parcel-focused business conversion program.

The union said it was seeking an “unconditional salary increase” for Royal Mail employees on the grounds that the company could afford it after publishing adjusted operating income of £ 758 million for the year to 27 March.

Risks to Royal Mail include ongoing union disputes over pay and its transformation program

In the open market against the background of rising stocks fell by more than 7%. inflation-oriented sales global.

Royal Mail said in a statement on the results: “We are now at a crossroads. We need to reap the benefits of change more quickly to ensure sustainable growth.

“We have already made significant operational changes, but this should lead to real efficiency savings that will bring financial benefits next year and beyond.

“The implementation of our existing agreements and the successful transition to subsequent agreements in the ongoing negotiations with the CWU will be key to future profitable growth.

“We have made a substantial pay offer to our people that will change the changes we need to stay competitive, grow and secure their jobs for the future. Our market is changing rapidly and agility in our response is crucial.”

“We don’t have time to spend”

Simon Thompson, CEO of Royal Mail, added: “As the pandemic emerges, the need to accelerate the transformation of our business, especially in the delivery sector, has become increasingly urgent.

“Our future is the business of parcels, so we need to adapt the old ways of working for letters, and do it much faster to a world where parcels are increasingly dominant.”

He added: “Our focus now is to keep up with our people and our unions to re-invent this British icon for future generations so we can give our customers what they want, grow our business sustainably and ensure long-term security work for our wonderful team.

“We don’t have time to spend.”

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