Halt to mail sell-off called for
The UK government must halt plans to sell-off part of the Royal Mail until it explains what the deal involves, a cross-party committee of MPs has said.
The UK government must halt plans to sell-off part of the Royal Mail until it explains what the deal involves, a cross-party committee of MPs has said.
The Business and Enterprise Committee said there was a “worrying lack of transparency” to the deal.
Committee chairman Peter Luff conceded Royal Mail’s vast pension deficit had to be tackled, but said it did not follow a “part sale” was necessary.
The government says its plans are the best way to make Royal Mail profitable.
It argues a “strategic partnership” with a private-sector company – which would take a stake of about 30% in Royal Mail – is the best way of modernising the service, which currently has a multibillion-pound pension deficit.
But Mr Luff said he and the committee had grave reservations over the proposals. He said: “We don’t know how much this sale will raise, we don’t know the use to which the money will be put.
“We’re very sceptical about the need for this sale and we believe the government needs to provide answers to these questions before the House of Commons can possibly consider the bill.”
He added: “We do not believe a 30% stake is the endgame. We believe there will be a commercial agreement signed between the government and whoever that person is, which will take the stake beyond 30% in the future.
“Possibly my biggest single concern is we do not know what’s going to be in the most important document of all – the contract between the private sector strategic partner – the equity partner – and the government.”
Meanwhile in the House of Lords, Business Secretary Lord Mandelson, who has championed the sell off, said the government hoped to complete the deal “later this year or early in 2010” and that “the process to find a partner is already under way”.
It has also been revealed that ministers from Lord Mandelson’s Whitehall department have held four separate meetings with a leading private sector bidder – Dutch giant TNT.
More than 140 Labour MPs have declared their opposition to the Bill, which allows the part-privatisation to go ahead.
But, with Conservatives and Liberal Democrats generally in support of the plans, the chances of a major government defeat are remote.
