Royal Mail’s hopes of giving shares to its employees appear to have been dashed after it emerged that the Conservative Party has expressed misgivings about backing the necessary legislation.
If the Tories oppose the plans, defeat in the House of Commons appears inevitable because of the huge opposition to the plan from Labour backbenchers.
Allan Leighton, the chairman of Royal Mail, has championed the plan to give employees a stake in the business. He had also wanted a stake to go to outside investors but that has been ruled out by the government.
Labour backbenchers are opposing the current plans for a 20% stake because they believe it is a precursor to privatisation.
The Communication Workers’ Union welcomed the developments, calling the shares issue “an irrelevance”.
The government is expected to outline plans for the structure of Royal Mail following the industry regulator’s new pricing plans, due in the next few days.