Britain's Largest Privatization in Over a Decade Underway

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Common Dreams

Britain's Largest Privatization in Over a Decade Underway

Banking giants Goldman Sachs, UBS to lead privatization of state-owned mail

by
Andrea Germanos, staff writer

"Once again consumers will lose out when prices rise and deliveries are reduced but banks make millions,” said Mario Dunn of the CWU. (Photo: nikoretro/cc/flickr)

Britain is continuing plans to privatize its state-owned mail service, the largest such effort since the privatization of its railways in the 1990s.

On Wednesday the government announced that banking giants Goldman Sachs and UBS would be leading the efforts. The Guardian reports:

As the lead banks advising on Royal Mail's sale the pair will collect the majority of the fees, understood to be set at about 1% of the target £2-3bn flotation value. Barclays and Bank of America Merrill Lynch will also collect millions in fees from more junior roles in the sale.

Echoing Billy Bragg's line "You privatize away and then you make us pay" in the song Thatcherites, Mario Dunn of the Communication Workers Union (CWU), which has campaigned against the privatization, said, “Banks are set to make up to £30 million when the government sells off Royal Mail. Once again consumers will lose out when prices rise and deliveries are reduced but banks make millions.”

As Rupert Neate noted, the mail privatization is something even the late British Prime Minister Margaret Thatcher, who privatized dozens of state-owned services in the 1980s, refused to do, saying she was "not prepared to have the Queen's head privatized."

Billy Hayes, general secretary of the CWU, said that his group felt the mail privatization was not "in the interests of customers, the workforce or the wider industry."

"Postal workers know that privatization would mean the break-up of the company, more job losses, worse terms and conditions and attacks on their pensions. It would be a wrecking ball to the industry they work in," said Hayes.

Britain's Department for Business Innovation and Skills told Bloomberg via email that the specifics about how or when the sale of the Royal Mail would happen were as yet undecided.

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