Billy Hayes goes into battle at Royal Mail

Billy Hayes is going into battle to keep Royal Mail in public ownership. It is a fight that the leader of the Communication Workers Union (CWU) has waged several times in recent years, but the old foe of private investment in the publicly owned postal service is back – and so is its combative opponent.
On this occasion, the conflict is centred on the possible sale of a stake in Royal Mail to a rival operator, probably TNT, the Dutch postal group, or perhaps, according to weekend reports, the Danish and Swedish post offices — with the union determined to block any form of private ownership in the group.
Sounds familiar? Seven years ago the Government tried to broker a merger between the Royal Mail and TNT. Later Allan Leighton, Royal Mail's chairman, raised the prospect of bringing in private money and creating shares in the business for employees – a move seen by many as a precursor to privatisation. Mr Leighton was forced to abandon his plans after a wave of protests from the union and backbench Labour MPs.
So here we go again. But why is full public ownership of the group so important, especially as some would argue that the public essence of the postal service began to go when competition was introduced, allowing private companies to work alongside Royal Mail?
Mr Hayes, a former postman from Liverpool, responds: “When ITV was introduced, it didn't stop the BBC being the best organisation in the world. We are looking at maybe a BBC model. People may say that just because liberalisation has come in then you might as well privatise it – well, we don't buy that.”
Royal Mail's problem though, as many might see it, is that it is a long way from being the best in the world. It has been bailed out by the Government several times, long before such bailouts became fashionable. Lord Mandelson, the Business Secretary, said recently that the organisation needed “gale-force change”. The recent Hooper review into the future of postal services, which sparked the Government's radical sale plan, highlighted the fact that last year Royal Mail was lossmaking and ranked last in a list of 13 Western European operators in terms of profit margins.
Mr Hayes argues that there must be value in the business, otherwise TNT would not be interested. “TNT aren't sitting in Holland with dewy eyes that they are really concerned about the future of Royal Mail. They are thinking how much money can they make out of it. End of.”
And the postal workers' leader is concerned that Royal Mail's service standards, including the universal service obligation (USO) – the pledge that post can be sent anywhere for the same flat fee – will worsen if a commercial organisation intent on maximising profits takes a stake: “If you have a USO and liberalisation, there is a tension built into the system straight away. In Japan, where they have liberalised and privatised, they only have deliveries three days a week now. The US is thinking of dropping to five days. Here [at] Royal Mail, a congestion charge for London deliveries has been mooted. The danger is we will have a universal service, but not a universal price.”
The postal group has been criticised for lacking modernisation and innovation as it tries to contend with a fast-changing landscape in which traditional post is rapidly migrating to new technology. It has also been attacked for its industrial relations record after a long and bitter dispute in 2007, which centred on pay and working practices.
But don't blame the union, Mr Hayes says. “We're up for modernisation. Obviously we want investment in the company. The delay on that has been mainly the company. I can't think of any way we delayed it.
“Obviously, there has got to be a reduction in the major sorting centres. You'll never find a bit of paper that says we don't recognise that there are going to be job losses.”
So where has it all gone wrong for Royal Mail, such that it seems constantly to be struggling? “Pensions is the first issue,” Mr Hayes said. “The Tories had basically about 13 years' holiday and cost the business £3 billion. It has a problem with its pension fund, created by the Tories.” Under the Government's plan, the State would assume full responsibility for the pension fund, which is expected to have a deficit of £8 billion soon. This is something that Royal Mail has been calling for for some time, although ministers will want the proceeds from the sale of a stake to cushion the responsibility that it is taking.
The CWU has been campaigning against the sale of a minority stake in Royal Mail since it was announced in December and it has garnered strong political support. Today it will hold a meeting with MPs and tomorrow a rally at the House of Commons. A total of 139 Labour MPs have signed a motion opposing the sale and the Government faces the prospect of the biggest rebellion under Gordon Brown's premiership so far when the postal reform Bill is launched.
For Mr Hayes and the union, the political fight may also result in one of the biggest blows for Labour's links with the unions. The CWU is committed to ballot its 250,000 members on stopping funds to the Labour Party if part of Royal Mail is sold.
Mr Hayes has been a member of the Labour Party for 33 years and will keep his individual membership no matter what the union decides. Although he is angry about the planned sale, and he has issues with other parts of Labour policy, he is passionate about the party. “I will be in it 'til I die, because I think it is the single most important instrument of social reform … I've heard people say you can't reform the Labour Party. I think that even now it can be, but that is separate from the link issues with the union.”
Apart from his opposition on ideological grounds to the Royal Mail sale plan, Mr Hayes also believes that the move goes against Labour Party policy because of a pledge in the last election manifesto to keep Royal Mail in public ownership.
“We've spent years developing the policy, I didn't even get a phone call saying we are bringing this in … Within a minute they wiped out six or seven years of policy-forming. Never has there been a report which has been endorsed so quickly.”
Ironically, Pat McFadden, the minister responsible for Royal Mail, is chair of Labour's national policy forum and Mr Hayes is a vice-chair. But the Government will argue that selling a minority stake does not take Royal Mail out of public ownership.
After several years of toing and froing over Royal Mail's structure, the two sides are at a crossroads and both believe there is no turning back. The battle lines have been drawn.
C.V.
Born: June 8, 1953, Liverpool
Career: After school became an apprentice fitter welder; then went to work at John West Foods; then became a postman; 1992: elected national officer for the union; 2001: elected general secretary. Later became chair of TUC unionlearn and the TUC general council’s spokesperson on Europe
Family: Married with two children, lives in South London
Q&A
Who, or what, is your mentor?
Dian Hayes [his wife].
Does money motivate you?
No, not at all.
What was the most important event in your working life?
Being elected general secretary of the CWU.
Which person do you most admire?
Rosa Parks (the American civil rights activist, who in December 1955 refused to give up her seat on a bus in Montgomery, Alabama, to a white passenger).
What gadget must you have?
The Apple notebook.
What does leadership mean to you?
Being honest.
How do you relax?
With my children, Niall, aged nine, and Melissa, six.