Tag: UK

Those unfamiliar with this Government’s penchant for saying one thing in public then doing exactly the opposite behind closed doors might start to wonder what on earth the Department of Trade and Industry is playing at over the future structure of Royal Mail. Leaders of Royal Mail’s still powerful unions think the answer is already clear. They believe the Government has given them cast-iron guarantees that it will remain in public ownership in return for a GBP1 million bung into the Labour Party’s coffers and support at the next election. But now the Mail on Sunday has learnt that the DTI, the department responsible for this huge national asset, has officials deployed full-time looking at alternative forms of ownership. Regular talks have been held with investment bankers, Royal Mail executives and Richard Gillingwater, head of the Shareholder Executive, which looks after the state’s business interests.

The Government injection of a further GBP300 million into securing the future of rural post offices until 2008 could be seen as a “fudge”, said the general secretary of the National Federation of Sub-Postmasters this week. The cash is on top of the GBP150 million annual subsidy which runs until 2006 but Colin Baker, whose organisation represents mainly rural people, said on Wednesday: “This is a two-year rollover and could be seen as a fudge to keep an ailing network as it is. But it does give us two years and we must use them wisely. What the federation wants to achieve is a sustainable and viable rural post office network because it is not, then communities will not be sustainable and viable.” The pledge has been seen by many as the government’s way of heading off a political row on the run-up to the next election. It is also understood that the continuation of the subsidy indicates that the government-owned Royal Mail will not be privatised.