Strike threat is putting off RM institutional investors

[TrueBlueTerrier]

Strike threat is putting off Royal Mail institutional investors

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Institutional investors say the threat of strikes by Royal Mail workers has made them wary of buying shares in the proposed flotation.

The Government has said it wants to float Royal Mail on the stock market within six months.

But one leading institutional investor said: ‘Potential industrial action is not going to raise our levels of enthusiasm for investing in Royal Mail should it be floated.

‘It is a sign the staff are not yet ready for the real world, frankly, and that would be a factor in any decision to invest.’

Last week, of the 74 per cent of members of the Communication Workers Union who voted, 96 per cent were against privatisation.

More than nine out of ten also supported a boycott of mail handled by rival firms and backed a policy of non-co-operation. There was virtually total support for the CWU’s above-inflation pay claim.

Potential investors in Royal Mail said their concern was for the underlying strength of the business.

Another said: ‘Royal Mail is beginning to sound like the big mining groups, which often have big, long-term problems with their staff.’

Royal Mail lodged a court injunction preventing the CWU from ‘inducing’ staff to action of any kind, such as refusing to handle rivals’ parcels, which it said would be unlawful.

The CWU agreed to take no further action until the case is heard in court this Friday.

A CWU spokesman said: ‘Any potential investors should be wary of the fact that the workforce is clearly opposed to privatisation. They know what’s best for the industry. The Government should now also listen.’

Business Minister Michael Fallon said he was ‘disappointed’ that members of the CWU had come out against the plan to sell shares in Royal Mail this financial year.

Fallon warned last month that he would turn instead to ‘plan B’, a private sale of Royal Mail, possibly to an overseas buyer, if the union tries to block a stock market flotation.

[Lounge Lizard]

"It is a sign the staff are not yet ready for the real world" - surely we see more of the real world than speculators sat in their city offices.

[Brain Fury]

Putting off potential investors by creating disputes over a broad range of issues is obviously the CWU strategy to oppose privatisation. I very much doubt that it will prevent this Government going ahead with a "plan B" sale to a competitor which IMO will be a very much worse result for all employees than a flotation. The eventual privatisation was sealed back in 2006 when the previous Government rushed to de-regulate the UK postal market. How can you have the government owning a company that is competing with the private sector at the same time as they are meant to be supporting the private sector? I don't know if the CWU opposition is ideological or simply self serving (I suspect the latter).

[koolishy67]

Fallon warned last month that he would turn instead to ‘plan B’, a private sale of Royal Mail, possibly to an overseas buyer, if the union tries to block a stock market flotation.

[Jynxx]

Makes you wonder if that was the plan all along, piss off the staff get them to strike blame everything on the cwu and its members sell off to one investor to make a quick buck (plan B ). Government looks rosy as its passed the blame, (Dave n his tory buddies get a large back hander)
Or maybe i'm just paranoid.

[TrueBlueTerrier]

I don't know if the CWU opposition is ideological or simply self serving (I suspect the latter).

Don't know about the Union, but my opposition is certainly partially self serving, I'd like to stay in work and pay taxes, and I'd like to earn the same level of wages I am now. Neither are certain when we are privatised but my best guess is our future is more secure as a nationalised company. If that's selfish tough, its just as selfish as selling to shareholders so they can make a profit, at least my way the service is under less pressure than it would be under privatisation.

[fishtank]

I don't know if the CWU opposition is ideological or simply self serving (I suspect the latter).

I don't know if the privatisation of Royal Mail is ideological or simply self serving (I suspect both).

[Brain Fury]

I don't know if the CWU opposition is ideological or simply self serving (I suspect the latter).

I don't know if the privatisation of Royal Mail is ideological or simply self serving (I suspect both).

Definitely ideological on behalf of this government - why else appoint Moya Greene unless on her track record of piloting through a privatisation. However, one has to wonder why all three parties are actually in favour of privatisation (whatever they tell their constituents). In my view it is because RM is the last nationalised service industry consistently held to ransom by its union and political parties of all colours want to distance themselves from any responsibility for the disputes or funding the failure of the business. In my opinion, privatisation of the business through share issue is the least worst option compared with sale to a competitor or still worse a slow death in public ownership. That so many people can't see that there is no status quo option is disappointing but not surprising.

[Brain Fury]

I don't know if the CWU opposition is ideological or simply self serving (I suspect the latter).

Don't know about the Union, but my opposition is certainly partially self serving, I'd like to stay in work and pay taxes, and I'd like to earn the same level of wages I am now. Neither are certain when we are privatised but my best guess is our future is more secure as a nationalised company. If that's selfish tough, its just as selfish as selling to shareholders so they can make a profit, at least my way the service is under less pressure than it would be under privatisation.

The business will still have to make a profit if it remains in public ownership. IMO no government is going to subsidise RM (even if it is legal to do so) and that means that if RM is to compete with it's rivals (who aren't going to go away) it will have to generate it's own investments funds. Without privatisation we can look forward to the return of regulated prices and demands for extreme cost cutting and that means job losses. The idea that RM will be under less pressure in the public sector is frankly laughable.

[TrueBlueTerrier]

I don't know if the CWU opposition is ideological or simply self serving (I suspect the latter).

Don't know about the Union, but my opposition is certainly partially self serving, I'd like to stay in work and pay taxes, and I'd like to earn the same level of wages I am now. Neither are certain when we are privatised but my best guess is our future is more secure as a nationalised company. If that's selfish tough, its just as selfish as selling to shareholders so they can make a profit, at least my way the service is under less pressure than it would be under privatisation.

The business will still have to make a profit if it remains in public ownership. IMO no government is going to subsidise RM (even if it is legal to do so) and that means that if RM is to compete with it's rivals (who aren't going to go away) it will have to generate it's own investments funds. Without privatisation we can look forward to the return of regulated prices and demands for extreme cost cutting and that means job losses. The idea that RM will be under less pressure in the public sector is frankly laughable.

I didn't say Royal Mail would be under less pressure, I said the service will - 2 different things.

Also the prices are still regulated and will be after privatisation, and extreme cost cutting is a fact of life in privatised businesses, as are job losses.

Those that support privatisation always think that the fewer they employ, then the more efficient they are, however the counter argument is that the fewer people employed, and the lower the wages, the higher the welfare bill, and the less taxes are paid and collected.

[UnhappyGremlin]

"It is a sign the staff are not yet ready for the real world" - surely we see more of the real world than speculators sat in their city offices.

Agree Lounge Lizard. We live in the real world, day in, day out. What moron came up with that crap?
We don't "earn" vast amounts off the backs of others, or from the misery of others being put out of work or having their pay slashed and working lives made hell.
We're the ones that struggle to pay energy bills that never stop rising, food costs spiralling out of control, and the rest, and all while we have suffered a real terms pay cut of 12-15% minimum in the last 7/8 years.
Why doesn't the person that said this work for RM for a few months? Then they'd know what the real world truly is. w****r.

[Danelectro]

Without privatisation we can look forward to the return of regulated prices and demands for extreme cost cutting and that means job losses. The idea that RM will be under less pressure in the public sector is frankly laughable.