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Germans and Dutch ready to scoop up Royal Mail in Mandelson's partial sell-off
Paul Waugh, Deputy Political Editor16 Dec 2008
FOREIGN firms were vying to buy up large chunks of Royal Mail today after it emerged that Lord Mandelson has drafted a £3billion plan to part-privatise the service.
Under a shake-up, at least a third of the company would be sold to a private firm. Dutch-owned TNT and German-owned DHL are both keen to secure the stake.
The Business Secretary, who says he will stick by Labour's manifesto commitment not to privatise Royal Mail in this Parliament, was today publishing a report recommending a partial sell-off. The independent study by Richard Hooper, a former deputy chairman of Ofcom, calls for an overhaul of the firm which faces a multi-billion-pound pension deficit.
Up to 50,000 jobs could be lost under his advice to close half of the postal service's 71 mail centres. "Last mile" delivery is likely to remain as a public monopoly.
Email and mobile phone traffic has hit traditional "snail mail", with the number of letters falling by five million last year.
Mr Hooper recommends modernisation to maintain a "universal service" and letter deliveries six days a week. A £7billion pensions deficit may be transferred to the taxpayer. The postal regulator Postcom will be scrapped and the service will come under communications watchdog Ofcom, reflecting the rising importance of IT.
A source close to the Business Secretary said: "Our concern is to secure the Royal Mail's future, not privatise it." Lord Mandelson faces criticism from unions and Labour MPs over the plan. Billy Hayes, general secretary of the Communication Workers Union, said: "The majority of politicians and public are fed up with privatisation. We will oppose any form of it."
Reader views (20)
42 years of my life spent in the Post Office with the objective of serving the people.
I canot equate profit with public service.
- Geoffrey Gould, alresford england, 19/05/2009 17:21
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Half of all the mail I have received this Christmas has not had the stamps franked or cancelled. No wonder they lose money - a dishonest individual would use them again! Perhaps a bit of German or Dutch effciency might improve matters.
- Keith, Ipswich UK, 17/12/2008 12:14
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Ian has hit the nail on the head. This sought of "sell out" of British institutions to foreign buyers could not and would not happen in any other country in the world. It`s outrageous. There appears to be no pride or loyalty left in this country whatsoever. How sad.
- Mick Harman, Romford, Essex, 16/12/2008 23:44
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As a shareholder with TNT,I welcome the proposed privatisation of the Post Office,the prospect of huge returns are very high in the built up areas of Britain,however for those living in the more rural areas they will be served by what remains after privatisation,perhaps as much as one delivery a week,or collect their own mail from the sorting office.
- Michael And Wendy Thompson, Bagshot Surrey, 16/12/2008 20:57
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Was Mandelason not hired to help the British economy?!???
- Jacqueline, Hampstead, London, 16/12/2008 20:19
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No one Knows how to manage any more, as long as they are getting big wages the fat cats don't care.
"It's not my fault gov"?.
- John.L., Scarborough N.Yks U.K., 16/12/2008 20:13
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This Labour Government has a very limited grasp of economics. They are preparing to sell the post office off in order to save £127M pa. But in so doing they are landing the taxpayer with a pension debt of £7Bn.What can they do right, the Sats are a fiasco, the Armed Forces pensions pathetic the NHS finacial blunders astronomical, and their ideas on improving child care hav left 120 children dead in the last year. Perhaps Oxford's report on Education sums it up: "It would have been better if they had done NOTHING AT ALL"
- Jeremiah, London, 16/12/2008 19:25
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We can't find managers capable of ensuring that RM operates in an efficient effective manner, mainly I think because of Government interference. Is the POOR taxpayer going to cover the pension fund deficiency?
The employees are good but they deserve better.
- Frank, Boncath, Wales, 16/12/2008 18:50
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With Labour it is always a one way street. Allow UK companies and organisation to be taken over by foreign businesses from countries where the reverse can’t happen.
The French government wants control of the UK’s nuclear power generation, but UK companies are not allowed the same freedoms in France. Now the Royal Mail to go to the Dutch, and again the reverse can’t happen.
The only thing wrong with the Royal Mail is that other companies can compete on the lucrative part of its business, with no responsibility to provide a universal service. That’s not competition that is annihilation by government decree.
- Ian, Reading, England, 16/12/2008 18:22
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Royal Mail used to trade profitably, it used to prop up parcel force it had a very good pension scheme until Labour started dismantling it. They took great slices of the profits for its treasury and raided the pension pot, it would not allow Royal Mail to compete nor could they get up to the minute equipment unless the government said so. Ofcom was not content until it had pushed royal mail into the ground, ofcom gave them only 12 months inwhich to change things modernise practices they originally said 2 years at least then changed their minds. Mandy should NOT have any say in this at all he is unelected. I used to work for Royal Mail before retirement I loved working for them and was very proud of it then Labour spoiled all that they had to employ asylum seekers foreigners who could not speak english most postman I knew were very proud of working for Royal Mail but in the end I hated it everything started to go to Scotland then sent back again for obvious reasons it was such a mess so I went along with 30000 others I blame Patricia Hewitt she started all the decline the government and ofcom made impossible demands on Royal Mail. Royal Mail should NOT be privatised this government has wrecked everything all our post office everything
- Jacqui Williams, peterborough cambs, 16/12/2008 17:29
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Brilliant!.Now the Royal Mail can follow all those other successful privatisations,gas,electricity,railways and buses.
- Colin, barking essex, 16/12/2008 16:37
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If they sell the Royal Mail into foreign ownership it will be like the power companies who charge us more in the UK than they charge customers in their home countries. We will end up yet again subsidising the rest of Europe.
- Deborah, London, 16/12/2008 14:30
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If the Germans and the French can operate a Post Office successfully and profitably, why not learn from their methods rather than sell Roral Mail to them.
- Patrick Griffin, Dalston, London, 16/12/2008 12:53
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Was Mandelson not just employed to save British companies and make them better?!
- Georgie, Islington, London, 16/12/2008 12:40
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When is anyone going to learn from past mistakes? Sell off the family silver/public services it will always result in a bad deal for consumers - British Gas; electricity; telephone providers; etc. All sold off resulting in higher prices as the companies seek to make huge profits for its shareholders and dreadful service for the consumer.
- Andy, London, 16/12/2008 12:34
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Police!!! Mandy's department obviously has a leak. I want arrests made! Double standards anyone?
How can you sell a business and still make a SEVEN billion liability for the long suffering taxpayer. How is this a 'good deal' for us?
Would it not be cheaper for the mugs er taxpayers to keep this dinosaur in public ownership? Just reform the civil service (and PO ) pensions? So that they are all as poor as us and we don't have to fund their champagne retirement from our new abode, the poor house? That would save a TRILLION pounds for the taxpaying sheeple! Too easy for you Mandy?
- Rusty Shackleford, UK, 16/12/2008 12:28
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Is this yet another sign that Britain is LEADING - the rest of the world - into an economic Depression?
Why doesn't Lord Mandelson simply put an advert in the media saying "Come and Get It" . . . Britain's "Closing Down Sale" . . . Everything NOW up to 70% OFF?
Much like the energy companies - prices to UK consumers will simply sky-rocket! Within months Second Class Stamps could be priced at up to £5.00 each! But, of course, by then it will be far cheaper to buy them using Euros (i.e. Europe's premier currency)!
P.S. Last person to leave Britain - Please turn out the lights!
- Fraser, Telford Park, 16/12/2008 12:24
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Yeah, because from previous experience we know that privatisation works, and as for selling utility companies to foreign based corporations, it's a great idea, look at EDF, the power supplies are 40% cheaper in France mainly by being subsidised by overcharging the British.
- Bob, Cheam, 16/12/2008 12:10
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WHY ARE WE SELLING YET MORE OF OUR BUSINESSES TO FOREIGERS. There will be nothing left of Britain soon. We need to get back our heritage, and the sooner the better, stop selling of to foreign buyers, invest more in Britain. Give jobs to British 1st then to foreigners.
- E Sullivan, London, 16/12/2008 11:05
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I think the key words there are 'not to privitise the Royal Mail IN THIS PARLIAMENT'. As always, there's a little loophole for doing the opposite later. And oh look: although he has time to quote on every other subject under the sun, yet again our Quote For The Day From Lord Mandy on THIS subject comes from 'a source close to the Business Secretary'.
Personally, I would prefer it if journalists would only take quotes directly from the decision makers because otherwise they aid and abet this Government from being held accountable.
- Roz, Chamonix, France, 16/12/2008 11:03
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