New cabinet ‘tested’ on post plan
Pushing ahead with plans to part-privatise the Royal Mail is “the test” of Gordon Brown’s reshuffled cabinet, says Tory frontbencher Ken Clarke.
Pushing ahead with plans to part-privatise the Royal Mail is “the test” of Gordon Brown’s reshuffled cabinet, says Tory frontbencher Ken Clarke.
He said the next steps on the plans would show whether the government was capable of “big decisions”.
It has been suggested the plan, opposed by 140 Labour MPs, may be dropped after the PM survived calls for him to quit.
Commons leader Harriet Harman earlier declined to say whether they would be debated before the summer recess.
The government’s bill would bring in a range of reforms, such as an invitation to private firms to form partnerships with Royal Mail – which could include a private-sector company taking as much as a 30% stake in its parcels and letters business.
Clarke told BBC One’s Politics Show: “Harriet Harman is trying to kill it off and Lord Mandelson is insisting that they carry on.”
He said it was “essential” that the Royal Mail be modernised to make it competitive.
“It’s the test, really, of whether this strange government that Peter Mandelson has put together with Gordon still nominally in charge is capable of taking a difficult decision with any serious problem,” he said.
“It is quite interesting to see whether any big decision can be taken and I will judge them very much by whether we go ahead with the second reading in the Commons of the Royal Mail Bill over the next week or two.”
Despite the potential of a large backbench Labour revolt on the issue, Business Secretary Lord Mandelson told the BBC last month: “I am definitely not for turning on the legislation.”
But after a week which saw several cabinet resignations, a reshuffle and disastrous results for Labour in the English council and European elections – Brown reportedly indicated he would act in a more “collegiate” way.
This has led to speculation at the Postal Services Bill, which has completed its passage through the Lords, could be watered down to appease backbenchers.
Earlier Harman declined to confirm it would come before MPs in the next few weeks – or even by the summer recess.
Asked whether she had not announced a date yet because the government feared it would lose, she said: “No it’s because we only announce the business two weeks ahead at a time and I actually announce the business to the House of Commons rather than on TV.”
She said: “We are determined that we have got to sort out the regulation of Royal Mail which is unfair and puts the Royal Mail at a competitive disadvantage compared to other independent suppliers. We have got to sort out the pension liabilities… The problems are there and they will have to be dealt with.”
The government argues that Royal Mail’s multi-billion pound pension deficit and the increasing popularity of e-mail means it cannot survive in its current form and needs outside investment.
But its critics, including the Communication Workers’ Union, say the government’s plan would “nationalise the pension fund and privatise the profit”.
