Royal Mail part-privatisation may lead to 50,000 job cuts

The planned break-up of Royal Mail may lead to 50,000 job cuts as the government unexpectedly agreed to part-privatise the organisation.

A report delivered to ministers last week by Richard Hooper, a former deputy chairman of Ofcom, has recommended selling half of the state-owned group to private business, which would result in the closure 30 mail centres.

Ministers discussed plans yesterday for a complete overhaul of Royal Mail to maintain a “universal service” and letter deliveries across the country six days a week. Business secretary Peter Mandelson accepted the recommendations in the report yesterday, including part-privatisation.

However, he stressed to the BBC that Royal Mail would never be fully privatised, and would remain “publicly owned.” He told the Lords: “I believe that Royal Mail and the postal market can thrive in the future – provided that decisive action is taken now.”

Mail delivery firms including the Dutch company TNT have already stated they would be interested in taking a stake in Royal Mail.

Yet earlier this week, commentators thought the government would never agree to part-privatisation. It has already caused controversy with the Labour Party, as Labour MP Jim McGovern resigned in protest at plans to part-privatise Royal Mail.

Unions have already warned that part-privatisation would lead to nearly one-third of the Royal Mail 170,000 workforce losing their jobs.

The move to reform Royal Mail comes about as 2,000 workers are due to stage a 24-hour strike this Friday, the day before the last posting day to get mail delivered by Christmas.

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