Hutton: strike will destroy Royal Mail

Postal workers have been warned by John Hutton, the new business minister, that they risk destroying the Royal Mail’s future by striking – dashing union hopes that the Government might favor their cause.

Hutton gave his warning ahead of two weeks of rolling strikes due to start on Wednesday. Royal Mail has already suffered two one-day strikes by 130,000 workers opposed to its modernization plans and its pay offer but is now proposing a series of smaller strikes on successive days.

Mail counters and cash-handling will be hit by Wednesday’s action with sorters due to strike on Thursday. The following day Britain’s busiest postal hub, at Heathrow, will close. The rolling programme means only a small group of strikers lose pay but the disruption to deliveries becomes cumulative.

Royal Mail, led by Chairman Allan Leighton, has offered a 2.5 per cent pay increase but is demanding GBP 380m of cost cuts from automation. The Communication Workers’ Union is demanding 27 per cent over five years.

Leighton says the state-owned mail service cannot afford to pay more because it is losing business to commercial rivals that pay lower wages. Some 20 per cent of post is now handled by private firms and this week’s strikes and confusion will encourage more customers to switch.

Leighton had hoped to bring the workforce onside by persuading the Government to give workers equity in Royal Mail. Hutton is standing by Labour’s manifesto commitment not to sell the business but appears willing to consider any workable plan Leighton can agree with unions.