Royal mail sell-off a dodgy deal says MPs

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Mandy mail sale a dodgy deal for taxpayers, say MPs

The Royal Mail sell-off was slammed as a dodgy deal by MPs yesterday.

A scathing report claimed Peter Mandelson's partprivatisation plan was a poor bargain for taxpayers. It also accused the Business Secretary of covering up his true intentions for the service.

The all-party Business Select Committee said Lord Mandelson had "failed to make the case" for a 30 per cent sell-off of the service.

It also warned it may pave the way for full privatisation. Committee chairman Peter Luff said Lord Mandelson's proposals were so vague they would not "even get on to Dragons' Den".

He said: "We don't know how much the sale would raise. We don't know the size of the investment in Royal Mail. And we don't know what the Government would do with the proceeds.

There's an extraordinary lack of clarity here." His colleague Roger Berry said MPs were being asked to buy a "pig in a poke".

The criticism leaves the Government's plans in chaos.

More than 140 Labour MPs have signalled they will vote against it, leaving Gordon Brown reliant on the Tories to get it through the Commons.

But the report may sway Conservatives to refuse to back the measure.

The committee document, agreed unanimously by members, said: "It is entirely unacceptable for Parliament to be asked to approve such fundamental changes to Royal Mail when there is no indication of how much money it needs for investment.

"The Government appears to have no business plan and has not indicated the use to which any private sector capital would be put.

"There is a consensus on the need to protect the universal service but the Government has yet to make the case that its proposals are the best way to do this." The report also said the Postal Services Bill would strip MPs of the right to prevent further stakes in Royal Mail being sold off.

It raises fears the Government is secretly paving the way for full privatisation.

Mr Luff added: "We do not believe a 30 per cent stake is an endgame."

Billy Hayes, of posties' union CWU, said: "Everyone who looks at this Bill agrees the case for privatisation has not been made. We urge Government to consider the views of the committee."

Lord Mandelson dismissed the report yesterday. He said: "It does nothing to secure a viable future for Royal Mail."

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Committee Report available to download at http://www.royalmailchat.co.uk/communit ... 36&t=15475" onclick="window.open(this.href);return false;

[Big Daz]

From the summary.

The Government already has powers to sell shares to enable Royal Mail to participate in a joint venture, provided that each disposal is authorised by Parliament. There is no upper limit on such sales. The proposals in the Postal Services Bill [Lords] would indeed make new provision to ensure that the Government retains a majority stake in Royal Mail, but Parliamentary control of each disposal would be lost.