P&O is between a rock and a hard place.
Going back in time my father would come home from his manual work job, change for the evening and would usually put on a tie. If we went out for a meal he would always be wearing a jacket and tie, even if it was just to a pub.
Go into any office now and not only will nobody be wearing a suit, let alone a tie, most people won't actually be in the office but working remotely from home dressed in tracksuit bottoms and a sweatshirt.
Go into just about any restaurant in the UK and I doubt you will find anyone wearing a tie let alone a suit.
The traditional people who cruised and for many years made up the majority of their customers and enjoyed the formal evenings and 'dressing up' in general are from my father's generation.
Unfortunately that generation are either dying off or have temporarily ceased cruising because of the pandemic and they are not willing to 'risk' getting on a cruise ship.
This change in customer base was inevitable but the pandemic has just accelerated the process.
Another issues with the older customer base not booking is they would pay the higher prices and so P&O have had to discount heavily to fill the cabins.
Recently P&O have been selling select price cruises for as little as £60 per night including £11.50 onboard credit and free parking worth £150+ so effectively a little over £40 a night for accommodation, travel, three (or more) meals, entertainment, etc. Those are 'bargain bucket' prices you couldn't get in a holiday camp in the UK, so do the customers booking them expect to 'dress up' more than they would on a holiday camp.
If P&O tries to do a 'Cunard' and insist on ties and jackets all the time then even selling cruises at those prices will fail and so it is trying to reach a compromise by reducing the number of formal nights to once a week on the newer ships.
But the next stage that will come in the next few years will be the optional 'dress to impress' that some other cruise lines operate and will replace the single formal night, as more and more people take the view that buying and taking a Dinner Jacket or a single night isn't worth it.
And there is nothing anyone can do to stop it, and the traditionalists ceasing to book because they are not getting the formality they experienced in the past will only hasten its demise.