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Labour aides may quit as Royal Mail revolt hits Cabinet
Nicholas Cecil and Joe Murphy24 Feb 2009
THE revolt over the Royal Mail spread to the Cabinet today.
Gordon Brown also faced the threat of resignation from at least two ministerial aides opposed to the sell-off.
Labour rebel John Grogan said: "It's going to be Peter Mandelson against a big bulk of the parliamentary Labour party.
"At least three Cabinet ministers are against this I know because they have spoken to me and told me they are."
Mr Grogan refused to name the ministers voicing concerns over the plans to sell about 30 per cent of the Royal Mail to a private company, possibly foreign.
However, speculation was rife that Health Secretary Alan Johnson was uneasy about the plan, having made his name as a union leader fighting similar privatisation plans under the Tories.
His spokesman said: "He supports the Government."
Hundreds of postal workers were demonstrating outside Parliament today over the plan.
However, inside the Commons the Royal Mail's chief executive Adam Crozier told the business select committee they were facing "rapidly declining" volumes of letters - with an eight per cent drop predicted next year.
When the pension deficit was revalued, it was expected to reach between £8billion and £9billion, he said.
"The simple fact is the business doesn't generate enough cash to ... ensure the future of the universal service obligation."
Two parliamentary private secretaries, Midlothian MP David Hamilton and Wirral West MP Stephen Hesford have signed a Commons motion opposing the sell-off. So far 145 MPs, nearly all Labour, have signed the motion.
Mr Hamilton, PPS to Climate Change Secretary Ed Miliband, told The Standard: "I have real concerns about a private company coming into a public organisation." He would not rule out resigning over the issue.
Union sources also claimed that Chief Whip Nick Brown, who has not taken action against the defiant ministerial aides, had himself voiced concerns over the privatisation moves.
Lord Mandelson also came under fire after the Business Department put out a letter from the Royal Mail pension trustees raising fears pensions would be cut if the sell-off is blocked.
However, the letter was reportedly not cleared by all the trustees and Labour MP Kate Hoey said: "People will feel there is an attempt to blackmail them into supporting part-privatisation."
Dutch postal group TNT has said it was keen to buy a stake in the Royal Mail.
Leading Labour backbench rebel Geraldine Smith attacked Lord Mandelson for trying to "spin" the pensions trustees letter. She said the introduction of Dutch firm TNT was "an insult to British management".
Mr Brown did not comment.
Reader views (9)
Await the backdown or fudge from McBroon and Mandelson.Neither have the honour or guts to stick to their guns. They are so obsessed with trying to save their political skins and the seats of the Labour members that amazingly what everybody thought was the position set out on the Post Office will be altered and the goal posts moved.
- Ian Glen., Durham. England., 24/02/2009 15:56
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All the while the Government cuts essential services because it has spent too much on expanding the Civil Service and on Benefits. One of the victims is the Post Office, and unless you share a postal district with a Cabinet Minister your post office is in danger. But Hey what about amalgamating the Post Office and the BBC? Just think how much the Government makes out of our licence fees, say, £139X25 million = Gosh £3.875Billion Oh no, I forgot, the Licence Fee is a stealth tax and has no relation to the quality of performance of the BBc let alone the Post Office
- Jeremiah, London, 24/02/2009 15:48
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Would anyone notice?
- R Jones, Bristol UK, 24/02/2009 15:39
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No-one will resign over this: their snouts are buried too far into the trough to want to give up their free iPods and plasma tellies.
- Nobby Clark, Perth, Scotland, 24/02/2009 15:29
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Selling the Post Office to a Dutch Company? The next thing you'll be telling me is that the British Government is run by the European Parliament - how preposterous. I think I can feel my blood boil.
- Geoff, In the country, 24/02/2009 15:21
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Less of this "may quit" nonsense, either you do, or you don't. If you're a member of the Labour party, you usually wait to be fired - eventually.
- Marianne, SW France, 24/02/2009 15:20
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If private big and foreign business get their hands on the royal mail it is almost guaranteed prices are going to rise, rise, rise to cover their costs and their elitist management salaries, pensions, bonuses and perks and of course employee numbers will be cut and worker pensions canceled. The prostitution of Royal Mail by some government bureaucrats must be stopped in its tracks right now.
- Peter Noterfed, Paris, France, 24/02/2009 15:15
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Better that the whole govt resign as this plan is merely so that Mugbroon can lay his hands on more money to stuff into his already over bloated force fed state service and to relieve the state's balance of some billions of liabilities.
Mandy would be doing a good job if he were to drastically trim the grossly obese state sector/services and restrict its diet of force feeding unwarranted/unmerited money. We can but hope, but then pigs might fly.
- Hugh, Middx, 24/02/2009 14:51
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It must be my age but I can NOT remember Mandelson being elected.Still his deputy Brown seems satisfied with him.
- Doff, filey yorks, 24/02/2009 14:49
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