Knowledge Centre
2nd July 2009
Business Secretary Lord Mandelson has said that "now is not the time" for the proposed minority sell off of Royal Mail.
Lord Mandelson told the House of Lords that the sell off would not go ahead in the "current circumstances", which would make it difficult to guarantee the tax payer value for money.
The news comes just three days after he admitted that the plans had been delayed, prompting accusations from Shadow Business Secretary Ken Clarke that the Government was in a state of "paralysed indecision".
According to Richard Hooper, chairman of the independent review of the postal services sector, it remains very important to bring in a private investor.
Hooper published Modernise or Decline in December 2008. The report set out policies to preserve the UK's universal postal service in the face of political intervention, strained industrial relations, and reduced access to capital.
He told BBC Radio Four's Today Programme that the problems had become worse in the months since the report.
"Modernisation has stalled, industrial relations have got worse, the Royal Mail's financial difficulties have got worse," he said.
Meanwhile, Lord Mandelson this morning condemned proposed strike action from postal workers over the modernisation plans, describing it as "exactly the head-in-the-sand approach I have warned about".
Modernise or Decline found that during 2007, 60% of the UK's total working days lost through industrial action came from the Royal Mail.
IMAGE by John Giles/PA Wire
Royal Mail sell-off mothballed
Lord Mandelson told the House of Lords that the sell off would not go ahead in the "current circumstances", which would make it difficult to guarantee the tax payer value for money.
The news comes just three days after he admitted that the plans had been delayed, prompting accusations from Shadow Business Secretary Ken Clarke that the Government was in a state of "paralysed indecision".
According to Richard Hooper, chairman of the independent review of the postal services sector, it remains very important to bring in a private investor.
Hooper published Modernise or Decline in December 2008. The report set out policies to preserve the UK's universal postal service in the face of political intervention, strained industrial relations, and reduced access to capital.
He told BBC Radio Four's Today Programme that the problems had become worse in the months since the report.
"Modernisation has stalled, industrial relations have got worse, the Royal Mail's financial difficulties have got worse," he said.
Meanwhile, Lord Mandelson this morning condemned proposed strike action from postal workers over the modernisation plans, describing it as "exactly the head-in-the-sand approach I have warned about".
Modernise or Decline found that during 2007, 60% of the UK's total working days lost through industrial action came from the Royal Mail.
IMAGE by John Giles/PA Wire
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