UK Postal Services Bill: Reaction from the top!

Royal Mail has praised the UK government’s plans to privatise the business. Today, the Postal Service Bill proposed to sell-off up to 90% of the company to a private investor, with 10% of shares going to company employees.

The UK operator “welcomed” plans for “rapid deregulation” and the intention “to resolve the £10.3bn historic pension deficit”.

Moya Greene, Royal Mail Group chief executive, said: “Deregulation of the UK postal services market is long overdue and I’m delighted that the government has made it clear that where there is competition, the shackles of regulation should be rapidly removed.

“It’s simply wrong that this suffocating regulatory approach should apply at all in a competitive market – and that it applies only to Royal Mail, which is the only company able to provide the Universal Service on which so many people depend,” she added.

Over the last few years Royal Mail has embarked on a £2bn modernisation and efficiency programme. However, with mail volumes continuing to fall, the process needs to be accelerated in order to maximise the company’s profitability.

Greene added: “We are absolutely committed to making this modernisation work and our people are of course central in that. We know that change is difficult and we’re determined to take our people and the unions with us. That’s why we’re pleased that the Bill also includes provision for employees to have at least a 10% share in Royal Mail.”

In response to the announcement, the Communication Workers Union (CWU) criticised the government’s “obsession with privatisation”.

The Union’s general secretary said the government had “wasted no time in flogging off the country’s state assets without exploring other options”.

Billy Hayes said: “This obsession with privatisation is deeply worrying. Handing postal services over to the City spivs and gamblers that Vince Cable recently denounced, but is now feeding, will be bad news for everyone.”

Hayes added that it is possible for Royal Mail to remain profitable without privatisation, and ultimately it will be the customer who loses out.

Royal Mail also said it would be working with the government on its plans to explore a possible mutualisation of Post Office Ltd.

In an open letter to subpostmasters, George Thomson, general secretary of the National Federation of Subpostmasters, said he was worried the Bill had been published too prematurely, “without sufficient attention given to how we secure additional income streams for post offices from new banking, government and other work”.

He added: “We are concerned that as things stand Post Office Ltd is not strong enough to survive and prosper as a stand-alone company outside of Royal Mail Group.”

More to follow…

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1 Comment

  1. Paul Jackson

    All parties need to change if this is going to happen:

    Post Offices need to be relocated to local authorities, paid for by local taxpayers who want or do not want the services perhaps some could even go into libraries?

    Customers need to accept higher mail prices.it is still a bargain to get national distribution for peanuts!

    Regulators have to give up on forcing an USO service accross the whole country.

    Unions have to accept that no longer are their workers skilled and deserving of inflated wages. Spanish practices should cease forthwith.

    Royal Mail needs to realise that it’s 3 businesses Offices/Parcel and Letters have no synergy and the group should be broken up. The government shouldn’t be owning GLS and Parcelforce at all.

    TYhe letters remaining division (Post offices have been decentralised to Councils) should be split between sortation/ and collection and delivery ensuring better use of capital and better access for independents /final mile.

    VAT should be charged @5% on Mail meaning that stamps would not go up as the reclaim would match the out put for Royal Mail.

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