British Post Office `Will lose £1.5m a day for three years'
The chairman of troubled postal group Consignia has said the company will continue to make losses of #1.5 million a day for the next three years, it emerged today.
Allan Leighton also said he did not believe the service should be privatised, adding that he was “confident” his business plan would turn the company’s fortunes around.
In an interview for the BBC Radio 4 On The Ropes programme, Mr Leighton told presenter John Humphrys: “We are losing #1.5 million a day. We can’t continue to do that. We will go bust.”
When asked when Consignia was going to stop losing money at that rate, he replied: “Not for probably three years.”
And when quizzed about whether the losses would continue at the rate of #1.5 million a day, the chairman replied: “Yeah. The plan that we have in place gets the mail’s business back to profit, and in terms of cash generation, in three years.
“In the same way that things don’t go wrong overnight, you can’t get things to go right overnight.”
Mr Leighton also discussed the future of Consignia and was pushed by Humphrys on the subject of privatisation.
Mr Leighton said: “People say surely you should be privatising. I don’t think we should. I don’t think we need to.
“I’m personally not a fan of privatisation.”
Humphrys: “But you’re not prepared to sit here and say we will not see the Post Office privatised.”
Mr Leighton: “I’m prepared to say in my time-scale we will not see the Post Office privatised.”
When pushed about how long he would be in his job and whether privatisation would follow his possible departure in three years, he said his advice “would be very strongly to keep it as it is”.
Mr Leighton was also questioned about his reputation for being ruthless.
He said: “I’ve never had to make a decision to make 30,000 people redundant before. I don’t ever want to do it again. It impacts people. It impacts people’s families.
“If you don’t feel bad about it, you don’t make quality decisions. But it still means you have to do the right thing.”
Last month Consignia was consigned to history as its name, 17,000 jobs and second deliveries were axed in a bid to reverse record losses.
A pre-tax loss of #1.1 billion for the last financial year was posted, including operating losses of #318 million, about #1.2 million for every working day.
The group announced it would be renamed Royal Mail at a cost of about #1 million, compared to the #1.5 million spent on launching Consignia 15 months previously.
The interview will be broadcast on BBC Radio 4 at 9am today, repeated at 9.30pm.
