Warning over Royal Mail privatisation

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PRIVATISING the Royal Mail could stifle business innovation and increase business costs, it has been claimed.

Rob Crowder, chief executive of Rural Community Action Notts (RCAN) has hit out after plans were revealed to privatise the service.

Mr Crowder said: "It seems to me that businesses could well have to pay more to have their mail delivered and getting parcels from online retailers could come at a premium for householders.

"Rural entrepreneurs are already hampered by having low, or in some cases, no broadband speeds, and now this comes on top of all the problems we have in the rural economy already.

"The winning bidders will have to protect prices for ten years and then it will be a free-for-all.

"The rural economy is already teetering on a knife-edge and I just have to hope this won't be the final straw that pushes some businesses over the edge."

Announcing the plans on Wednesday, Business Secretary Vince Cable said: "It is consistent with developments elsewhere in Europe where privatised operators produce profit margins far higher than the Royal Mail, but have continued to provide high-quality and expanding services.

"Now the time has come for the Government to step back from Royal Mail and allow its management to focus wholeheartedly on growing the business and planning for the future."