Royal Mail 'won't be privatised'

Post by **TrueBlueTerrier** » 15 Dec 2008, 13:09

http://www.politics.co.uk/news/opinion- ... 254794.htm

A privatised Royal Mail is off the agenda, sources close to business secretary Lord Mandelson have said.

The comments come ahead of a report on the Royal Mail expected this week which will set out plans to modernise the service.

But early warnings of privatisation - sparked by comments made by Lord Mandelson before he became business secretary - appear to have been inaccurate.

"Our concern is to save the Royal Mail and secure its future, not privatise it," a government source told Sky News.

"We have a manifesto commitment to a publicly-owned Royal Mail and we will not be setting that aside."

This week's report - by Richard Hooper, former deputy chairman of media watchdog Ofcom - is expected to say a universal service should be maintained an letter delivered six days a week across the country.

But it is also likely to raise concerns about Royal Mail's pensions deficit, which is likely to have doubled from its £3.4 billion level in 2006.

The report comes as the Communication Workers Union presses ahead with a strike this Friday in mostly north-western post offices, threatening the Christmas mail.

Post by **TrueBlueTerrier** » 15 Dec 2008, 13:14

http://conservativehome.blogs.com/toryd ... -to-r.html

Following an independent study by Richard Hooper, the Government is to rule out privatising the Royal Mail.

An interim report in May stated that "the status quo is not tenable" and that "radical"changes would be necessary.

The final report has now been delivered to the Business Department and it will be published in due course, but the Press Association is already citing "a source close to Lord Mandelson" as ruling out privatisation.

PA quotes the source as saying:

"Our concern is to save the Royal Mail and secure its future, not privatise it. We have a manifesto commitment to a publicly owned Royal Mail and we will not be setting that aside."

Any Conservative reaction will be posted as it emerges.

-------------------------------------- Comments from this page - Seems even the Conuservatives don't wont us privatised-------------

Comments

Tories need to privatize it immediately and open the entire sector to genuine competition - from post box to last mile.

With any luck it'll collapse under the weight of the pensions liabilities, thus absolving the taxpayer of this white elephant once and for all.

Posted by: Adam- | December 14, 2008 at 20:20

I'd like to agree Adam but I can't imagine the Party's rural MPs (i.e. almost all of them at present) feeling comfortable justifying thousands more Post Office-less villages. Some services receive public subsidy for a reason.

Posted by: jamie | December 14, 2008 at 20:34

The Royal Mail has been a “Nationalised Industry” since the time of Charles II and long may it remain so for it is one of the institutions which holds this nation together. Furthermore, it is now facing totally unfair competition (forced upon us by Brussels) which is cherry picking the profitable routes without any obligation to deliver to the rural areas, Hebrides etc.

Posted by: David_at_Home | December 14, 2008 at 20:36

I hope the majority view in the Conservative party is not that of Adam above. Any privatization of the Royal Mail should require by law that all services be maintained to every part of the UK. If that means massive losses for shareholders..... tough.
Many of the most vulnerable people in our society rely on this service and whatever ideology one follows it is important as David at home recognises that this is one of the institutions which holds this nation together.

Posted by: Malcolm Dunn | December 14, 2008 at 21:38

I would have thought that the middle of recession and credit crunch was the worst possible time to privatise anything, let alone Royal Mail.

Posted by: Adam in London | December 14, 2008 at 21:39

Royal Mail is part of our heritage and should never be privatised. Surely part of Conservatism is to conserve?

Posted by: Post Office Lover | December 14, 2008 at 22:01

Bloomin heck Malcolm, we are agreeing again- we'd best be careful. :D

Posted by: comstock | December 14, 2008 at 22:13

Adams comments I find are reckless with a lack empathy for many people, especially those in the countrywide, many of whom are Conservative voters who's communities rely on the Post office. Hoping that the Post Office, a service that provides a immensely valuable services to many rural areas, should "collapse under the weight of the pensions liabilities" is frankly repugnant.

Being a Conservative doesn't mean the endless pursuit of total privatisation of everything and anything, as although the application of a free market environment to the vast majority of industries provides the consumer with hugely improved choice of products, services and efficient, amongst many other benefits, in some cases it also means those industries that provide and essential service to people living in remote communities or vulnerable people, are not profitable find their lifelines cut inflicting intense hardship. Quality of life for communities and people should be a large part of the next Conservative Government if we are to promote a drive of repairing the breakdown community and society.

Posted by: YMT | December 14, 2008 at 22:26

Having worked for Royal Mail some time ago in their Publuc Affairs department it may be helpful to point out a few things.

The argument that you cant privatise Royal Mail as it would lead to the closure of post offices is easily solved. Privatise just the Royal Mail bit as opposed to Post Office Ltd (which operates the physical post offices) Of course any commercial operator would never want to offer a universal service at a uniform tariff.

Then of course those who say the Post Office has always benen in public hands always forget that the vast majority of post offices are privately owned businesses. When I worked there there were 500 state owned post offices out of 19,000 to give you an idea of the scale of private ownership.

Posted by: Jonathan Sheppard | December 14, 2008 at 22:42

Adam (the one who posted the first message). You are expressing the kind of view that turned the Conservatives into the "nasty" party. It is a great pleasure to see that your opinions are unique to yourself.

The Royal Mail part-privatisation (authors Hewitt and Brown) was one of the biggest, but maybe least recognised, bungles of the current government. From the start, the reorganised company was hampered by huge virtual loans from the Treasury, and the interest borne on them, that distort fundamentally any appreciation of its operating finances.

We need to have an open-minded policy in relation to RM, quite possibly allowing the prospect of re-nationalisation. We also need to have a good look at what the real EU requirement is over commercial competition - does it really need to be quite so comprehensive as the government has allowed?

Whatever critics say, Royal Mail is a vital service across the whole country. I have heard it described by some as the only visible payback on their income tax! The impact of the current round of Post Office closures is bad enough, especially in rural areas, but in fact anywhere away from right in the town centres. Closure of Royal Mail would be a disaster and is not really to be contemplated.

As a suggestion, we need to be looking at Public Sector-related tasks that can be brought into (maybe back into) the aegis of the Post Office network. One such is TV Licensing. By increasing the RM's turnover, we can potentially safeguard its future without necessarily proposing vastly expensive subsidies.

Posted by: JohnfromCamberley | December 14, 2008 at 22:51

Privatise just the Royal Mail bit

Then you can't call it Royal Mail any onger - maybe "BritMail" until Deutsche Post takes it over or KPN....but it cannot be Royal Mail in the private sector and VAT will need to go on stamps when it ceases to be a Crown business

Posted by: TomTom | December 15, 2008 at 06:14

It definitely isn't the right time to privatise anything, really. Hower, I have seen it suggested that it would lead to the closure of Post Offices.

Have I missed something or are thousands of Post Offices closing already?

Posted by: SuperBlue | December 15, 2008 at 09:08

Post by **fmrPOSTIE** » 15 Dec 2008, 13:27

Ive said on this forum before that Peter Mandleson never said he wanted RM privatised, he came out and clarified his position after the media mis-quoted him. So do not believe everything the papers tell you!

Whether you like this bloke or not at least he's done the honourable thing and cancelled POCA tendering & is comitted to the Warwick II agreement. It seems likely the Govt will be liable for the pensions deficit too, what more could you want?

Night Tonic · Post by **Night Tonic** » 15 Dec 2008, 15:36

No, everyone will be liable for the deficit. The government take the profit from RM when its there but the debt would be given to the people. It also says more cuts are on the way if it isn't privatised. NW will be nothing.

Phantom · Post by **Phantom** » 15 Dec 2008, 16:02

Well if they can bail the banks out then they can do the same for RM.

RM loses 10,000 staff a year through high turnover, sackings and retirement so i wouldn't panic just yet. Although middle management does need culling, far too heavy.

Post by **fmrPOSTIE** » 15 Dec 2008, 16:38

Night Tonic wrote:No, everyone will be liable for the deficit. The government take the profit from RM when its there but the debt would be given to the people. It also says more cuts are on the way if it isn't privatised. NW will be nothing.

The govt hasn't taken a profit out of Royal Mail since 2000, at least. It was the Tories who raided the profits in return for a state monopoly, and it kinda worked quite well.

axeman · Post by **axeman** » 15 Dec 2008, 16:57

looks like 'nightronic' and 'teaman' better start packing there bags and clearing the desks out from what i heard on the grape vine today

DGP1 · Post by **DGP1** » 15 Dec 2008, 17:00

axeman wrote:looks like 'nightronic' and 'teaman' better start packing there bags and clearing the desks out from what i heard on the grape vine today

I love grapes

was it nice a juicy

Night Tonic · Post by **Night Tonic** » 15 Dec 2008, 17:07

Said before Axeman, i have just a few months before I retire. Unfortunately you don't but I can bring a deckchair if you like.

Post by **dvbuk55** » 15 Dec 2008, 17:08

Although they have ruled out "privatisation" there has been a big play on "partnership" and increased participation by other operators. That may be a bit of sleight of hand. There haven't been any specifics "leaked", because the report hasn't yet been released, it will be interesting to see exactly how the Government intends to implement the recommendations. It will be good news if they do underwrite the pensions deficit though, that will save the company a huge amount and there will be more in the pot for pay rises

Post by **fmrPOSTIE** » 15 Dec 2008, 17:17

We all know whats going to happen, the Hooper Report will call for privatisation/JV with TNT/CVC etc.

Lord Mandelson will reject this idea and go for middle ground i.e. public sector option with massive rationalisation of MCs/DOs. Im quite happy to see MCs merged but not DOs they are the front end of Royal Mail and need to be kept in town areas whereby the public can get their parcels without having to travel miles, and allowing posties to deliver around town without having to travel long distances back to the DO.

Once again i fear more cuts on top of existing ones, i'd love RM to be returned to a state monopoly - by that i mean getting rid of the EU directive requiring the UK to open up the postal market, the only way that is going to happen is if we leave the EU or things get that serious that somebody will "opt-out" of this crappy directive.

Night Tonic · Post by **Night Tonic** » 15 Dec 2008, 17:20

Well heres my prediction. Expect mass job cuts across the board in 2009. Government will insist on bigger savings.

Post by **TrueBlueTerrier** » 15 Dec 2008, 17:33

Night Tonic wrote:Well heres my prediction. Expect mass job cuts across the board in 2009. Government will insist on bigger savings.

Where - deliveries already survive on OT only.

Management would be a possibility but with everyone, including Hellmail, predicting that next year is going to be a bad one for IR they will want to keep them on side.

Processing - this is a definite possibility - I can see this being sold off Unit by Unit and RM paying companies to get the mail to DOs.

Support Functions - Yes that will be privatised - first thing to go when they start the break up.

HQs (National and Regional) - Again yes this will probably be cut to the bone because 1 complaint everyone has is that there are too many managers and admin staff and if they modernise the non operational processes a lot of the small empires will disappear. Also if MCs are sold off not as many managers will be needed to deal with the day to day matters.

axeman · Post by **axeman** » 15 Dec 2008, 17:35

should rephrase it nighty to 'jobs from the board down' operations staff already cut to the bone as weve said on many occasions to many chiefs and not enough indians if you go soon

you could well be on for evr

Post by **fmrPOSTIE** » 15 Dec 2008, 17:47

what support functions? RM has already done this with Quadrant, RoMEC, and its IT Dept. We all know what happened to CHS, the Co. pulled out!

Selling off individual business units is a no brainer, too costly in the long run. And job losses...The Govt will be keen to keep redundancies to a minimum given the current economy. Like i say - it will be a bodge job with Mail Centre closures and rationalisation. Not much else.

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