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'Dunce' PM accused over Mail sale


Ed Miliband speaks during Prime Minister's Questions

Ed Miliband speaks during Prime Minister's Questions

Ed Miliband speaks during Prime Minister's Questions

Ed Miliband has accused Prime Minister David Cameron of selling off the Royal Mail at "mates' rates" to friends in the City.

In furious exchanges in the House of Commons, the Labour leader branded Mr Cameron "the dunce of Downing Street" for selling a majority of the company for £1.4 billion less than its current valuation, while the Prime Minister dismissed him and shadow chancellor Ed Balls as "muppets" in return.

Mr Cameron said Labour had tried and failed to sell a share in the Royal Mail when it was in power. But the Prime Minister slipped up by claiming that a sell-off was promised in Labour's manifesto for the 2010 general election, when the document promised "continuing modernisation and investment... in the public sector".

During their regular weekly clash at Prime Minister's Questions, Mr Miliband challenged Mr Cameron to name today's share price, compared with the initial sale offering of 330p.

"You sold at 330p and this morning the price was 563p," said the Labour leader. "It is basic maths - not so much the wolf of Wall Street, more the dunce of Downing Street."

Mr Cameron replied: "I will take a lecture from almost anyone in the country about the sale of Royal Mail, but not from the two muppets who advised the last chancellor on selling the gold. There they sit, not a word of apology for £9 billion wasted."

Mr Miliband told the Prime Minister: "The taxpayer... got £1.4 billion less for this valuable asset than it is worth today.

"A third of the shares were sold to just 16 City investors. And get this - there was a gentleman's agreement those City investors wouldn't sell the shares. What happened? Within weeks, half of those shares had been sold and they made a killing worth hundreds of millions of pounds.

"In other words, mates' rates to your friends in the City."

Mr Cameron said the questions were only being raised because Mr Miliband was "paid to by the trade unions".

He told the Commons: "You sat in a Cabinet that wanted to privatise the Royal Mail - that was the commitment.

"What happened was the general secretary of the Communication Workers Union said this: 'In terms of the last Labour government, they tried to privatise the Royal Mail, it was the unions that brought the government to its senses'.

"Once again, they were weak in government because they couldn't carry out their policies, they are weak in opposition because they don't support shareholding by post workers in the Royal Mail, they are weak because they have no economic policy, and they are weak because they have got no plan."

But Mr Miliband continued his attack: "You have gone as red as a post box and that is because you have lost £1.4 billion for the taxpayer.

"This is a taxpayer sale nobody wanted and nobody voted for. A national asset sold at a knockdown price to make a fortune for the few.

"It's a symbol of a Government which stands up for the wrong people, with the British people paying the price."

Mr Cameron said: "What happened is the taxpayer is £2 billion better off. Anyone who sold shares has missed out on what is a successful business.

"The truth is this. You sat in a Cabinet that wanted to privatise the Royal Mail, they couldn't do it... because the trade unions won't let them. There are now 140,000 shareholders working for the Royal Mail, there are almost three-quarters of a million members of the public with shares.

"These are signs for celebration in our country, not talking them down because they are anti-market, anti-competitive, and anti-business."

Mr Cameron mocked Mr Miliband over a job advert placed by Labour for a broadcasting adviser, which said the successful candidate must be "prepared to work closely with different teams across the Labour Party with the ability to build consensus with a range of stakeholders".

"I think that must be the hardest job in Britain," Mr Cameron joked.

"Nothing has changed in the Labour Party - no wonder they have advertised this week for someone to bring fresh ideas to the leadership."

Mr Cameron ended the exchange by saying: "It's a sale nobody wanted? It was in your manifesto! It was a commitment of the last government.

"They worked so hard, they failed to do it, but this coalition Government privatised the Royal Mail, created thousands of new shareholders, have a great business working for Britain.

"We have seen it all from Labour this week. They are advertising for fresh ideas, people around you are fighting like ferrets in a sack. And get this - their top adviser is called Arnie, and he has gone to America.

"But unlike Arnie, he said 'I'm not coming back'. They are warring, they are weak and they haven't got a plan."

Immediately after the exchanges, Labour MP Jon Ashworth raised a point of order, saying that Mr Cameron should be ordered to return to the House to correct his assertion about the party's manifesto pledge. But the request was turned down by Speaker John Bercow.