Privatisation shelved amid poor prospects for sale

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THE Government’s controversial plans to sell off a stake in Royal Mail have this week been “kicked into the long grass”, Tribune has learned. MPs were expected to debate the Postal Services Bill, which will open the door to selling up to 49 per cent of Royal Mail, next week. But MPs say the bill is no longer to be debated for at least another four weeks, making it highly likely that Parliament will go into summer recess before the Commons discusses the plans.

The news comes amid speculation that the planned auction of a 30 per cent stake in Royal Mail Group will have to be postponed because the two firm offers, from private equity group CVC and Dutch postal firm TNT, are too low.

Lindsay Hoyle, Labour MP for Chorley and a leading opponent of the plans, said: “The bottom line is it’s in the long grass. It’s completely vanished and it’s not in the next three to four weeks’ business. I think it’s good for the party, good for the members and good for the trade union movement. It’s a win for everybody.”

Deputy leader Harriet Harman refused to answer repeated questions about Royal Mail during a reportedly stormy meeting of the Parliamentary Labour Party this week.

Geraldine Smith, another opponent, said: “It’s obviously a very difficult time for the Government and I think it’d be suicidal for them to proceed with this bill.” More than half of Labour MPs have signed an early day motion against part-privatisation, which may mean ministers are forced to rely on Conservative and Liberal Democrat votes to push the bill through.

As Tribune went to press, speculation was growing in Westminster and union circles that Lord Mandelson may be moved in Gordon Brown’s expected Cabinet reshuffle, as part of a move to abandon the Royal Mail sale entirely.

The Communication Workers’ Union conference next week is set to debate a number of motions calling on the union to break with Labour or trim its funding. However, a disaffiliation vote is highly unlikely after the union’s executive indicated it will support keeping the Labour link.

A spokesperson at the business department said they had not heard that the plans were being deferred