Return to Sender? ~ Is now the right time to privatise RM

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Return to Sender? ~ Is now the right time to privatise Royal Mail?

http://www.bowgroup.org/policy/return-s ... royal-mail" onclick="window.open(this.href);return false;

The Bow Group today releases a major Briefing Paper exploring the merits of the privatisation of Royal Mail.

The paper, written by Bow Group Chairman Ben Harris-Quinney, with contributions from the Minister of State for Business & Enterprise Rt Hon Michael Fallon MP and the "Save our Royal Mail Campaign", explores both pro and con arguments to privatisation and concludes that amendment and delay to the Privatisation Bill are necessary to encourage public and industry support, whilst realising full value for the tax-payer.

The YouGov Poll commissioned for the paper demonstrates that only 53% of the public are aware of the Governments plans to privatise Royal Mail, with 67% of people opposed to the move.



READ THE FULL PAPER HERE. http://www.bowgroup.org/sites/bowgroup. ... 20Mail.pdf" onclick="window.open(this.href);return false;



The Royal Mail is one of Britain’s oldest and most patronised institutions, spanning 500 years of British history it is more than a mere functionary postal service, it has come to form an important part of our national and cultural fabric, as well as our economy.

Any changes to its form and function must therefore be the subject of intense public debate to ensure that both its tradition of universal provision of service and our national heritage are maintained and that the British taxpayer is actively considered in the debate.

The 2011 Postal Services Act, privatising the Post Office, was passed with little fanfare or debate in public forum. The product of a Liberal Democrat Secretary of State following the failed policy of the last Labour Government, it was also the Conservative Party’s Coalition Government partner that steered that legislation through Parliament. The Postal Services Act has proved to be extremely unpopular with voters since being enacted, and does not serve as an effective example of successful privatisation either economically or politically.

Since 2011 there has been little public debate about the merits of privatising Royal Mail, and to the public eye it may appear that we have transitioned from an unheralded Act of Parliament to an equally unheralded privatision, without fully considering the impact this might have on the provision of postal service, British heritage and on the Conservative Party politically.

This can perhaps be easily explained in all three major Parliamentary parties strongly supporting the privatisation, the result has been inadequate scrutiny to a Bill which, while relatively popular in Parliament, is conversely deeply unpopular among the general public.

The polling data released in this paper shows that almost half of those surveyed were not aware of the imminent privatisation of Royal Mail, and almost 70% of those surveyed were opposed to it.

This polling data should be of concern to the supporters of the Bill, but these are not insurmountable figures for the Conservative Party to overcome, and The Rt Hon Michael Fallon MP has shown great maturity in his willingness to debate and engage with the issue, actively considering the anti-privatisation argument which he himself once supported when in opposition.

It is, however, of great importance that the Conservative Party and the Government pause and consider the implications of privatisation at this time, that a comprehensive free and public debate is had, and that if moving ahead the Government take the necessary time to consider amendments and compromise solutions to elements of the Bill which raise the greatest public concern.

This Bow Briefing Paper therefore aims to consider the arguments for and against privatisation, as put forward by The Rt Hon Michael Fallon MP, Minister of State for Business and Enterprise, The Royal Mail, and the campaigning organisation “Save our Royal Mail”. The paper will demonstrate polling data produced by YouGov on public knowledge and support for the Bill, and will conclude as to amendments to the Bill and future policy that could facilitiate greater public and industry support, as well as better value and protection for the taxpayer.


If moving ahead with privatisation the Bow Group calls on the Government to:

- Engage in a public campaign of advertising and debate to increase awareness of both the privatisation and the opportunity for the tax payer to purchase shares;

- Offer long term legislative guarantees for the universal service in its current form until 2025;

- Re-introduce regulatory control to the price of first class post;

- Offer long term protection and assurances of continued Government business for the Post Office counter network;

- Enact legislation to enshrine in law freepost services for HM Armed Forces serving abroad and on operations.

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CONCLUSION
The role that Royal Mail and the Post Office play in our communities, particularly rural
communities, is significant, unique, much cherished and much needed.

The universal service obligation, including a single stamp price protects and enhances our
countryside and could serve as a foundation for a new high-tech economy, but rural
deliveries are far from profitable. This leads us to the inevitable conclusion that a privately
owned Royal Mail would, over time, seek to denude those high cost services and focus its
activities in the more competitive but highly profitable urban areas.

People in rural towns and villages are only too aware of this and that is why, when it is
realised that Royal Mail may be sold off, there is significant opposition. That might also
explain the reluctance of the government to address this matter publicly or in Parliament.
We have discussed how we see the business developing as a public sector enterprise – the
safest way to guarantee rural services.

Conservatives should apply some simple political tests before proceeding with this
controversial sale – has the case for privatisation been adequately publicly made? Are all
possible protections for service and heritage in place? Is it the best deal for the country? Is it
popular with the public? Is it politically beneficial to our party? As reflected in our polling in all
cases the answer is currently “no”.

Electorally it could be quite damaging for the Conservative Party, but this is not just a
left/right issue – successive governments have tried to sell Royal Mail and failed. Perhaps
there is a good reason for this. The economic outlook suggests that the tax payer will not be
able to realise full value from a sale at this time. Indeed it is estimated that revenue from a
sale might be as low as £2bn – hardly a sum that can compensate for the national and
political damage it will cause.

Though there are clearly alternatives, if privatisation must occur Ministers can save
themselves a lot of headaches if they argue that tax payer’s interests must come first, and
postpone the sale whilst implementing key amendments to the current privatisation

[fishtank]

Interesting part here.

So how exactly can a new owner extract greater value from Royal Mail? The simple answer
is to reduce the services that are non-profitable.

Conveniently the government has carried legislation allowing a new owner to do just that.
The 2011 Postal Services Act allows Ministers to create a special administrative regime to
maintain the universal service obligation.

It is highly probably that after a few years, a buyer will conclude that it can no longer fulfill its legal requirement to undertake its legal obligations.

It will then simply transfer the rump of its non-profitable business back onto
the tax-payer, taking with it the highly profitable urban letter and parcels traffic.