The Royal Mail is to be privatised.
Labour did, of course, begin this fiasco. It was inevitable that the Coalition would continue it. Politicians of all shades need to hang their heads in shame.
There is no evidence that privatisation increases investment: the railways prove that. And privatisation does, anyway, increase the cost of investing.
There is ample evidence that privatisation gives rise to mass job losses and reductions in conditions of service when the UK needs even moderately paid jobs (and most in the Post Office are that, at best).
I know technology has moved some communication on, but not all.
And for remote communities the chance that privatisation will not increase the chance of isolation is, well, remote.
What is more, none of this makes financial sense: the Post Office is making some money now. So this is dogma driven, and nothing else. It's the proverbial selling of the family silver to give the private sector another chance to exploit ordinary people for the benefit of a few.
And yes, that is why it is right that unions oppose this privatisation that can only be harmful to us all.
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And of course one should not mention the cost of eletricity and water just to prove the obvious.
There is also ample evidence (see the Netherlands) that privatising postal services leads to poor and chaotic services.
I instinctively felt that privatising Royal Mail was wrong-headed, and now you have provided reasons to explain why.
Low-cost universal mail delivery cannot deliver high profits, so a private operator would inevitably either raise prices dramatically or curtail the universal service, and yesterday’s announcement suggest that the universal service will only be guaranteed for the first ten years after privatisation. I expect the universal service to disappear in year 11.
I did hear Cable on the radio yesterday referring to ‘a great British company’. Well, not for long, eh?
And it is noteworthy, that our national assets are always sold to a foreign corporation which locks-in the next government, preventing re-nationalisation under WTO rules.
Actually, mail service privatisation has little to do with the three parties, and is in fact the result of an EU-wide series of directives : http://www.euractiv.com/transport/postal-services-liberalisation/article-161377
Simply not true
That can be ignored
Actually it is undountedly (© Richard Murphy) true.
http://register.consilium.europa.eu/pdf/en/07/st13/st13593.en07.pdf
And not requiring sale of Royal mail
Cable should hang his head in shame. Still he’s ensured his future career at Goldman Sachs. And today we learn that G4S and Serco have defrauded the taxpayers of £10m + by claiming for tagging prisoners who are either in jail, abroad or even dead. How many more scams have they got up their sleeves?
How many more scams have they got up their sleeves? – Plenty, scamming is the very raison d’etre and the Fons et origo of neo-liberalism!
I believe the money from this sale will be used to bribe the electorate (tax reduction) before the next election.
Undountedly
Simply ignore the law?
I think we all know the tune by now:-
Lawyers and accountants organize the IPO, with enormous fees for all.
A fund, probably with foreign owners, buys the controlling interest, with borrowed money
A board of directors is appointed, perhaps with political connections, who get paid about 400 times the wages of average postman
No corporation tax is paid because of the loan interest and the discrete use of tax havens.
The service ends up charging monopoly prices and ends up a shambles.
Listening to the five o’clock news, we learn that Serco and G4S have overcharged by millions of pounds.
Where is the so called free market when you privatise a monopoly? Are we going to see rival post offices compete against one another? The same applies with major airports. In Australia, they sold Sydney International to a bank (Macquarie runs it under a separate fund/structure, while they collect management fees on it). Prices for parking there went to ridiculous levels and then they wonder why people want to get the hell in and out of there as quickly as possible. It’s really a shame the pollies never privatise themselves – but I suppose who would invest the money to buy them? 🙂
Unfortunately Anthony, Royal Mail lost it’s monopoly at the beginning of 2006 when other providers were able to deliver mail in the UK. It will be interesting to see whether other providers do actually come into the market, whereas up to now they have been using RM for downstream access. It may be far too expensive for them to set up their own networks. This could actually work in RM’s favour over the long term, but probably detrimental to us.
As one other commentator intimated, we do not have market competition in this country, we have price-fixing cartels (Electricity, Water, Gas and now Mail). A sad state of affairs!
It is an effective monopoly
Only the wilfully blind ignore that
Royal Mail isn’t a long term investment opportunity because there is no prospect of growth. You can’t support universal service through a monopoly on the delivery of letters when fewer and fewer people want to send them. The price of postage will continue to increase to cover the falling numbers, and the number of people sending letters will continue to fall as a consequence.