A fresh wave of postal strikes were dramatically called off last night, just hours before the latest walkouts were due to begin.

Sources said that a 24-hour national stoppage due to be held today and next Monday would not go ahead after a deal was agreed to end a long-running row over jobs, pay and pensions.

Members of the Communication Workers' Union (CWU) have held a series of strikes in recent months which have caused huge delays to mail deliveries.

But following several days of talks between the union leaders and the Royal Mail, an agreement was finally reached.

The union's postal executive is believed to have sanctioned the agreement at a meeting in London yesterday.

Business Secretary Lord Mandelson welcomed the news that the strikes had been put on hold, saying he hoped that all the “wrinkles” in the modernisation process could be solved by negotiation.

“These strikes have done nothing to help Royal Mail,” he told a Press conference in London.

TUC general secretary Brendan Barber said the agreement provided for a “period of calm” in the run-up to and beyond Christmas, free of industrial action to enable further negotiations to be held to secure a longer term deal.

Mr Barber said the agreement also resolved a number of local disputes which have flared in recent months and addressed areas of concern for the union and workers.

“The agreement is a very important step forward but it is a long way from the end of the road,” he added.

Dave Ward, the union's deputy general secretary, said he was pleased with the agreement, which had been accepted unanimously by the postal executive of the CWU.

“We can now have a period of calm where we hope we can genuinely take forward modernisation in a way that puts the union at the centre.

“Our members will now know we can deal with modernisation in a way that gives them improved job security and improved terms and conditions.”

Mr Ward said the union was under no illusions about the hard work ahead and he said the dispute had been “bitter”.

He went on: “It will take exceptional efforts to rebuild trust. But we will work very hard to ensure that the agreement stays on track.”

He issued a fresh plea to the Government to tackle the Royal Mail's £10 billion pension fund deficit, saying that until that was dealt with it will be difficult to overcome the “challenges” ahead.

The union said details of the agreement would be released later today.

David Frost, director-general of the British Chambers of Commerce, said: “This is very welcome news and we are glad some common sense has prevailed in the run-up to Christmas.”

Royal Mail managing director Mark Higson said he was “delighted” for customers that a “sensible agreement” had been reached which would allow deliveries to return to normal in the run-up to Christmas.

He added: “We look forward to positive and constructive discussions on the next stage of Royal Mail's modernisation plan, which is key to the future of the company, all those who rely on it and to the future of the universal service.”