Allan Leighton, chairman of the Royal Mail, is reportedly trying to persuade the government to take on part of its pension bill, so that he can proceed with a partial privatisation of the business.
Royal Mail is trying to shift £1.5bn of its £2.5bn pension liabilities on to the government’s books as a crucial step towards the partial sale.
The postal group, which declared annual operating profits of £537m yesterday, wants the government to take responsibility for 220,000 existing pensioners of the scheme, which started in 1969, reported the Times.
That would strengthen Royal Mail’s balance sheet and enable it to raise up to £5bn from banks and the market.
Royal Mail executives and the Department of Trade and Industry (DTI) have already held talks, and the issue will be a key part of a DTI review of the impact of competition on the state-owned group.