Privatisation of the Royal Mail


National Postal Workers Day: about 50 people turned up to show their support
National Postal Workers Day: about 50 people turned up to show their support

As I’m sure you are all aware by now, the Royal Mail was privatised on Friday.

It was sold for £3.3 billion. Within a day the share price had risen by 38%, meaning that the company was seriously undervalued and some people made a quick profit.

Billy Hayes, General Secretary of the Communications Workers Union, said, ‘If you sold your house and the buyer sold it on the next day for 38% profit, you’d ask “what was the estate agent doing?”’

Actually it is even worse than this. If you remember, the government took on the company’s pension liability two years ago. That was at a cost to the exchequer of over £10 billion.

So in this case the government has spent three times the value of the property, in order to sell it at a significant loss, in order for the new buyer to then sell it on for a profit.

Meanwhile, the company has spent the last two years modernising the business. Postal workers have been provided with new vans, new trolleys, new walk-sequencing machines, new GPS devices, new bags, new shelving units, new uniforms, and a range of other equipment. Delivery offices have been closed all over the country and consolidated into larger units. Costs have been cut and door-to-door (junk mail) incorporated into the work load. New working methods have been introduced, and every round in the country has been extensively restructured.

All of this has been done at the taxpayers expense, of course.

The regulator has lifted pricing restrictions, which means that the company is now making a healthy profit. So, you have to ask, why couldn’t the regulator lift the restrictions earlier, in which case the company could have been earning a healthy profit for the taxpayer for years?

70% of the company has been sold to large investors: to banks, hedge funds, pension funds and sovereign wealth funds, including the one belonging to the Kuwaiti Royal Family. In other words, the British public have taken a significant loss so that this fabulously wealthy family can extract even more wealth for themselves.

The Kuwaiti Royal Family are the absolute rulers of a medieval feudal state. Not ‘wealth creators’. Wealth extractors. That means that postal workers in the future are going to be the servants of a feudal Lord. Serfs, in other words. Who says there’s no such thing as progress?

Moya Greene, the current CEO, has also said there will be further job losses, which can only mean that postal workers will be expected to work harder. She took £1.47 million in pay and bonuses last year. No doubt she will be given substantial share options too, now that the company is in private hands.

So what will this mean for you? Let’s make the comparison with previous privatisations.

Water charges have risen by 245% since the water boards were privatised. Subsidies to the rail industry have more than doubled, while fares have increased above the rate of inflation and standards have declined. And in the same week that the Royal Mail was floated on the stock exchange, the energy company SSE put up its prices by 8.2%. More price rises are expected to follow.

Our public utilities are now almost exclusively owned by foreign corporations.

Did you know that the origin of the word ‘idiot’ is from the Greek word meaning ‘private’? Or, to put it another way, the sale of Royal Mail has brought even more idiocy into our public life.

Sign a petition to renationalise the Royal Mail:


10 thoughts on “Privatisation of the Royal Mail

  1. Trouble is, we would have got this whichever party was in power. I expect Privatisation would have happened had Lab won the election instead of Con- Lib Dem. The “special advisers who devised the NHS (GP commissioning) reforms for example were brought in by Gordon Brown, then,


  2. Are there any remnants of democracy left in the Western world? When are the Brits going revolt against the hostile takeover (called privatisation) of their shared resources and public companies?

    Ever since Hayek, Reagan, Thatcher et al showed up with their deception propaganda labelling the welfare system and public ownership a “red threat”, almost everyone seems to fall for their tricks. Neoliberalism has caused so much destruction and confusion that almost everyone believes in libertarianism and dismisses real democracy.

    This is going to be a disaster – in fact it is already, a genocide – on a global scale that it is hard to describe in a few line. (Yet I try)

    The bottom line: No one has the right to sell to anyone what belongs to everyone in a country.

    A law that allows above is NOT democratic rule of law: it is legalised mega-corruption and robbery. Since the dawn of Thatcherism and Reaganism all politicians almost everywhere in the world are leading their respective countries into mega-greed games, privatisation and bailout schemes – in effect into a new dictatorial feudalism, mass-poverty and hunger.

    Public ownership means DEMOCRATIC ownership with the purpose to make sure that everyone has access to these vital services, wheras private owners of these are put into a monopoly price-dictating position (in this regard privatisation is the real red threat!) who can sell their services at any price only a limited circle can afford to pay for.
    (The famously disastrous private healthcare system in the US is a sheer evidence of the genocide effect of such ventures.)

    The advocates of neoliberalism who in fact destroyed the delicate balance among the players of free markets, preach Adam Smith’s magic invisible hand, but the majority is unaware that even Smith admitted the necessity of welfare benefits and what Smith did not emphasise is the scope of that “invisible hand”: that scope does NOT have to extend to the whole population – the equilibrium between supply and demand can settle at a point that covers only a fragment of the potential participants in economy both on the markets of products and services and on the labour market.

    What this means: the vast majority are and will be forced out of all macroeconomic cycles, and without welfare they will be condemned to starve to death and be without shelter.


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