Ownership of the Royal Mail returned to the spotlight today as the postal group reported an increased operating profit of £404 million despite a slump in the number of letters posted.
The coalition Government announced it would seek to inject private capital into the business, including opportunities for employee ownership, in line with pledges made by the Conservatives and the Liberal Democrats |in the run-up to the general |election.
No details of how private capital will be attracted were given, although the Government will be well aware that the previous Labour administration had to shelve its controversial plans to part-privatise Royal Mail last year following a huge revolt by |backbench Labour MPs and a concerted campaign of opposition by the Communication Worker’s Union.
Billy Hayes, the union's general secretary, said: “This is old politics wrapped in new language. The British public has consistently rejected the privatisation of Royal Mail. The move to regurgitate failed policies will be deeply unpopular.”
But Business Secretary Vince Cable said there was “nothing sensational” about today's announcement, adding: “Both coalition partners realise we have got to grapple with that problem.
“You may remember that Lord Heseltine tried and failed, the Labour government tried twice and failed.
“There are big problems around the pension fund and we are going to have to deal with it. We have made it very clear that the injection of private capital is an important part of that.
“Certainly an issue we have emphasised is working participation and ownership, these are things we need to look at.
“It is a big issue that can't just be left in the long grass, it has got to be dealt with.”