The British postal union Communications Workers Union (CWU) yesterday explicitly declared itsopposition to Royal Mail’s privatisation plans at a meeting of the parliamentary BERR Select
Committee.British business secretary, Lord Mandelson, has already given his backing to therecommendations of an independent review of the UK postal sector that the government should takeresponsibility for the group’s rising pension fund deficit and that it needed to recruit astrategic partner. This was presented in a report by Richard Hooper, the Chairman of the GovernmentPostal Review.
CWU general secretary Billy Hayes claimed that there was a successful model for a fullypublicly owned Royal Mail provided proper investment and commitment was secured. Rejecting thesuggestion to bring in a strategic partner, Hayes told the cross-party business and enterprisecommittee of MPs that the government would in effect be removing the pension fund liabilities fromRoyal Mail’s balance sheet, improving the financial health of the company and making it moreattractive to an outside investor.
He attacked Mandelson’s support for bringing in an outside minority shareholder: “Why shouldwe nationalise the debt (in the form of the pension deficit) and privatise the profit?”
Dave Ward, CWU deputy general secretary, said the report lacked financial transparencypreventing plans for a successful future for Royal Mail. “We need to know that the management ofthe Royal Mail is committed to sorting out the problems faced by the company in the increasinglyturbulent mail market. We welcome modernisation and continue to call for better equipment andautomation to allow our members to compete more effectively with other operators,” he said.
Responding to Hooper’s statement that a partner was needed to bring expertise into thecompany, Roger Berry, one of the MPs, asked: “As you have identified a skills gap, why not buy inthat expertise in the form of consultants or management? It’s a skills deficit; why do you need aprivate company to have a stake in the business to solve that?”
Roger Berry also questioned the recommendation for private finance at a time when publicbodies have to bail out other sectors. “In the present climate and given the urgent need forinvestment, isn’t it a bit optimistic to expect the private sector to provide the funds?” he asked.
