Some will argue that Labour started the privatisation of Royal Mail and so shouldn’t oppose it now. It’s true that when in Government, Labour proposed reforms which paved the way for privatisation. However, the 2009 Postal Services Bill specifically included a clause stated that “each Royal Mail company must at all times be publicly owned”, meaning private interests would always be on a minority basis. Losing control of a service that 29 million homes and businesses rely on was never an option.
In little over a week, a 370 year history of public ownership of Royal Mail comes to an end.
Lots of Royal Mail sites are in prime locations, your high streets. There is a very good chance that the public will see these sold and relocated to industrial parks. Price increases and service standard decreases (particularly to those in non profitable rural areas) are also likely once we lose Royal Mail. It is not surprising that several polls show around 70% of the public oppose privatisation.
The staff aren’t too happy about it either. A staggering 93% of Parcelforce staff voted against privatisation. Naturally, the CWU served legal notice of their intention to ballot members for strike action. The result will be announced on October 16th. Luckily for David Cameron, shares begin trading on 15 October.
So if everyone hates the idea, why are the Tories so intent on pushing through this sale?
Royal Mail makes money. A lot of money. In May, preliminary financial results showed operating profits for the last year of 403 million pounds!
David Cameron and George Osborne happen to need some money. A failed economic plan has seen 245 billion pounds of borrowing that they didn’t plan for. So in true Tory style, they are ripping apart our country and selling it to their friends, piece by piece.
What the Tories have also tried to keep quiet, is that they have made arrangements to ensure that not only will we obviously lose future profits of Royal Mail, but we will be keeping the historic pension deficit and liabilities. In other words, they are privatising the profits and nationalising the debt.
Of course, it is unfair of me to say that ‘everyone’ hates the idea. I assume Goldman Sachs and UBS are quite happy. In true democratic style, the Government have refused Freedom of Information requests about how much the banks will be paid for handling the sale, but estimates are as high as £30m (Sunday Mirror article http://www.mirror.co.uk/money/city-news/royal-mail-privatisation-banks-set-1983088).
So in reality, there are lots of people who will be happy about the privatisation of Royal Mail: The Tories will be able to cover up some of the failure of their economic plans, their friends are set to get a very good deal on the flotation price (at our expense) and the banks will be rewarded handsomely. Would we expect anything else from David Cameron?
Today sees campaigners out, up and down the country. Please follow on #SaveOurRM