Royal Mail sell-off policy slammed

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The Conservative Business Minister responsible for selling off Royal Mail has "lit the fuse and put the 'For Sale' signs up" to spare the embarrassment of the Government's failed austerity programme, Labour has claimed.

Shadow business minister Ian Murray attacked the Chancellor's economic strategy, suggesting this was the real reason behind the rushed sale of the nation's postal service.

In an exchange with the Business Secretary Vince Cable during Business Questions in the Commons, he said: "We know his Minister - who I'm surprised isn't answering this question - is seen as a firefighter in government, but rather than putting the fire out with regards to the Royal Mail, he's lit the fuse and put the 'For Sale' signs up. He's rushing this through, of course, to spare the blushes of his Chancellor, who's borrowing £245 billion more than he said in 2010 and is desperate for pre-election cash into the coffers."

Mr Murray was referring to Business Minister Michael Fallon, who had previously revealed in a letter to a constituent that he did not support the sale of Royal Mail.

Turning to Mr Cable, he said: "Why then - after his minister signed a letter in 2009 when he said he was opposed to privatisation - are they rushing a sell-off, which is opposed by right-wing think tanks, the unions, the National Federation of Sub-Postmasters, small businesses, the Liberal Democrats and people up and down this country who will receive a poorer postal service as a result?"

When the letter emerged last month, it caused embarrassment to Mr Fallon, who is charged with privatising the postal service by March 2014.

The Business Secretary laughed off the suggestion that the Government was rushing through the sale. Mr Cable said: "I think the party opposite has a strange but rather revealing idea of speedy decision making.

"This process of bringing private capital into the Post Office started in 2008 - under my Labour predecessor. This was one of our first pieces of legislation, it was something I introduced in the House and was agreed and we are now following through it in an orderly way and designed it to get good value for the taxpayer and a good outcome for the Royal Mail."

Labour's David Hanson (Delyn) asked how much would be paid in commission to the banks. He said: "Will you tell the House how much will be paid in commission to banks or handling agencies of these shares to people who are buying things that they actually already own?"

Mr Cable declined to offer a figure, saying: "The process will be a competitive one and he is right, it is designed to achieve value for money for the taxpayer and he will know it is practice to enclose details of those fees in the prospectus and he will see that in due course."