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'Daylight Robbery': UK Announces Privatization of State-Run Mail Service

Royal Mail sell off will hamper mail service and hurt working conditions, unions warn

Jacob Chamberlain

The official plan for the privatization of the UK's centuries old mail service, Royal Mail, was announced by business secretary Vince Cable on Wednesday to the ire of trade unions and others who have slammed the biggest privatization since the railways in the 1990s as "daylight robbery."

Cable said a majority of the shares would be sold in the private sector, although it was unclear as to exactly how much. The majority stake in Royal Mail will be posted on the London Stock Exchange within the next nine months, or by March at the latest, for prospective buyers including "foreign postal services, hedge funds, and city speculators," said consumer watchdog group Sum of Us.

Additionally, in "a bid to weaken support for trade unions which have helped to scupper past attempts to sell off Royal Mail," the government announced plans to give away 10 percent of shares in Royal Mail to the 150,000 UK postal workers, Reuters reports.

Billy Hayes, general secretary of the Communication Workers Union (CWU), which represents two-thirds of the Royal Mail's 150,000 workforce, said they wouldn't "sell their soul" for the 10 percent stake.

30-year Royal Mail employee Malcolm Curry told the Guardian, "The government are the winners, not the Royal Mail workers. The rich get richer and the poor get poorer … I don't think there's any benefits for us and none for the customers. I can't see that in 12 months' time we'll be delivering to every household every day. Privatization is all about making profits. There will be cut-backs, and shareholders will have profits instead."

Journalist and author John Harris adds sarcastically that the privatization is happening "with the aid of a syndicate of banks headed by those well-known guarantors of the public interest, Goldman Sachs and UBS. The financiers will take home around £30m; over time, the rest of us will likely end up with a threadbare postal service, and the feeling that we were robbed, in broad daylight."

Cable also made promises that Royal Mail would be obligated to continue providing six-day mail service across Britain despite its new private ownership. However, many people, including unions representing Royal Mail workers, remain opposed to the privatization and say it could lead to a decline in working conditions.

Unions representing the Royal Mail staff rejected a pay offer and are now threatening strike action including the CWU.

Dave Ward, the CWU deputy general secretary, stated Wednesday:

The flotation announcement has ignored the views of the workforce and the British public. The workforce agreed a modernization program with Royal Mail three years ago and it didn't include privatization.

They have worked hard to modernize the company and deliver the profitable organization Royal Mail is today. They have recently voted in big numbers against the sale and they will be angered by the announcement.

CWU will continue to fight the sale and without worthwhile and legally binding assurances on terms and conditions, strike action is inevitable.

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