Brown pledges Royal Mail investment

Prime Minister Gordon Brown said his government will spend £1.9bn ($2.7bn) on the country’s post office network, to maintain the “universal service” obligation.

Prime Minister Gordon Brown said his government will spend £1.9bn ($2.7bn) on the country’s post office network, to maintain the “universal service” obligation.

Brown, speaking at a televised Labour Party event in Bristol on 28 February, said he would invest in the Royal Mail Group Plc, and guarantee a £25bn ($35.9bn) pension fund.

The government is asking lawmakers for the authority to sell around a third of the 360-year-old Royal Mail to an outside investor such as TNT NV of the Netherlands to prepare the postal service for Europe-wide competition. Opposition to the Postal Services Bill means Brown could face the biggest rebellion in Parliament since he took office in 2007.

“I do say to you that guaranteeing a £25bn pension fund, spending £1.9bn on the post office network, maintaining a universal service obligation can be achieved if we make the investment that is necessary to secure the Royal Mail for the future,” Brown said. “And that is what’s behind our proposals to get someone to help us invest so that we can prepare the Royal Mail for the international and national challenges ahead.”

Under the Postal Services Act of 2000, the Royal Mail is required to provide “universal service,” making at least one delivery every working day to all individual UK households.