Home / Feature / 10 Reasons the Royal Mail should never have been privatised

10 Reasons the Royal Mail should never have been privatised

2

By Rayhan Ahmed Topader  :

The government has sold a 13 per cent stake to institutions, and gifted its remaining 1 per cent stake to eligible Royal Mail staff, meaning the company is now fully privatised for the first time in its 500-year history.I think that decision was wrong because Royal Mail is not only profitable business. It’s very helpful to all over the world community, also its very reliable, comfortable and

easy to get for everyone but now is very far away from people’s. So Royal Mail should be brought back into public ownership.

Poor value for money is not the only reason to lament the passing of Royal Mail into private han- ds.It’s been reported today that in the governme- nt’s rush to push through the privatisation of Roy- al Mail the taxpayer was shortchanged.The Natio- nal Audit Office has claimed that too much emph- asis was put on completing the sale within this parliament rather than achieving value for money. As a result, shares in the company are now more than 70 per cent higher than the origi- nal sale price of 330p in October 2013.

But poor value for money is not the only reason

to lament the passing of Royal Mail into private hands.There are several other reasons to worry.

The Royal Mail was profitable. Surely better to keep the company public and plow the profits back into the service instead of handing them to shareholders.The Royal Mail made £440 million last year.The fact that the Tories were still despe- rate to privatise what was an increasingly succ- essful business smacked of fanaticism.

Small businesses and rural communities will be the first to suffer-but all 26 million British house- holds will be affected.​

Cost-cutting will place a huge question mark over the universal service.This isn’t left-wing propaga- nda as some on the right claim.The Bow Group, the oldest conservative think-tank in Britain,warn- ed last year that privatisation could see the price of a stamp increase and Post Offices in rural areas close.

Post Offices in rural areas are more likely to close.Which means Royal Mail far away from people’s, so they are not happy atolls.People always looking which way to get easy and better services.

The taxpayer was shortchanged by the sale. Royal Mail shares are more than 70 per cent higher than the original sale price of 330p in October 2013. Business minister Michael Fallon last year stated “categorically that we have no intention of selling off Royal Mail cheaply.But the sale price set by the government has now been branded too cautious” by the National Audit Office.The taxpayer made around £2bn from the sale of Royal Mail.However if the shares had been sold at 610p, which is where Goldman Sachs believes the price will eventually settle at, the chancellor, and by extension the taxpayer, would have brought in around £3.66bn.

If privatisation goes ahead, stamp prices are expected to rise to £1 but which was very cheap prices and it was very easy to use for everyone because people always looking which way to get cheap. So if stump prices will go up then people’s will go far from Royal Mail.So definitely it was wrong decision to privatise.

Stamp prices could eventually reach £1.The price regulation of stamps was scrapped by the coali- tion prior to privatisation to increase the attrac- tiveness of Royal Mail to investors.That brought with it the possibility that stamp prices could eventually hit £1.The first price increases come into force today, with first class increasing by 2p to 62p and second class by 3p to 53p.To get a glipse of the future it’s worth looking at train fares Since privatisation ten years of above-inflation rail price increases mean that some in the south-east of England now spend 15 per cent of their salary on rail travel.

The Royal Mail is succeeding in public hands and made £440 million in profits last year – money that can be reinvested into the service.

The Royal Mail was a 500-year-old institution and part of the fabric of Britain. Institutions matter, and there are certain things which are associated with Britain, such as the NHS, cricket, red phone boxes and yes, the Royal Mail.The public hasn’t been consulted.The Royal Mail is ours.We use it,we pay for it,we should have a say in what happens to it.

Royal Mail should be brought back into public ownership, Jeremy Corbyn says.Also Jeremy Corbyn believes the Royal Mail should be brought back into public ownership.

Labour leader Jeremy Corbyn has argued for the Royal Mail to be brought back into public owner- ship and warned that the Post Office is under increasing threat.He won loud applause from del- egates at the annual conference of the Comm- unication Workers Union with a passionate defe- nce of keeping post offices open and defending the universal postal service.

The best thing would be for Royal Mail and the Post Office to be brought back together in public ownership, not the system of ownership we have at present.Mr Corbyn said the Post Office seemed to be under increasing threat, as more branches were franchised, hitting rural communities and access to services for older people as well as terms and conditions of workers.

Postal workers were the lifeblood” of communi- ties, regarded as a friend, he said,adding: Ïf we lose it and it breaks up and have fewer High Street post offices, we have lost something that pionee- rs fought for.The bean-counters in our Governme- nt don’t realise the human aspect of the Post Office.

Mr Corbyn said Labour would defend the universal service obligation, under which letters are delivered anywhere in the country for the same price, and would repeal the controversial Trade Union Bill which imposes a threshold on strike ballots and other reforms to the way unions operate.Strangely, conservatives are supposed to understand a bit about tradition. Yet the current government appears to believe that everything can be reduced to its monetary value.

Nils Pratley argues that Royal Mail is not a comp- any in a condition to be sold” and that it should not be privatised for years (Privatise post-haste and regret at leisure,15 June). It is a seductive argument-but wrong.

The National Audit Office, in its studies of past privatisations, has argued that if government wants to maximise its proceeds it should initially sell a majority stake in the company.This enables the private sector to take the necessary decisions to turn the business around without government constraints.The government can then sell its remaining shareholding, if it wishes, at a later date.This is a far more sensible approach than

the one which Pratley advocates.

                                       Rayhan Ahmed Topader

                                       raihan567@yahoo.co.uk

Leave a Reply