Future of Postal Services

Debate between Lord Spellar and Tahir Ali

Tuesday 10th January 2023 Westminster Hall

[Tahir Ali]

I thank my hon. Friend for that intervention, and I could not agree more.

I have highlighted a glimpse of the bleak future that the management at Royal Mail want: poorer pay, poorer conditions, overworked staff, a zero-hour workforce and a service that is neither universal nor satisfactory to the customer. That has been seen in the steady erosion of the universal service obligation, along with the recent announcement that Royal Mail will be split into two entities and potentially sold off to the asset-stripping company Vesa Equity Investment, which is currently its largest shareholder.

It is evident from this that Royal Mail profiteering is becoming the name of the game. The billions in revenue generated by Royal Mail staff are eaten up by shareholders and management, who pay themselves huge bonuses while staff struggle to make ends meet. Instead of being reinvested to truly modernise and improve Royal Mail, this revenue is being used to pay off shareholders.

It is clear to me, therefore, that there are two possible futures for Royal Mail: one as a universal public service provided with compassion and dedication by employees who are valued and respected; and the other just as a delivery company, to be pumped for profit and asset-stripped, at the expense of service users and with workers’ pay and conditions eroded. What does all of this signal for the future of postal services in the UK?

[John Spellar (Warley) (Lab)]

I thank my hon. Friend for giving way; he is making an excellent speech. Is it not, even in commercial terms, an incredibly short-term prospect? Fundamentally, the current management of Royal Mail are trashing the business and will therefore end up, even on their own terms, with a much-weakened company, which unfortunately may then have to be nationalised because it is failing. The service that it is providing is so bad that people are moving away from it. That really is a national crisis that requires Government intervention.

[Tahir Ali]

I could not agree more with my right hon. Friend, who is a neighbouring MP from my region. This will turn Royal Mail into a badly performing company. CEOs and management move on, but it is the employees who stay and have to pick up the pieces.

I believe that the present circumstances offer us two possible paths forward: one ensuring that Royal Mail continues to offer an exemplary public service to all in the UK, with the profits of expanding operations going into decent pay and conditions for staff, as well as improvements to the service overall; and another in which Royal Mail is stripped of its public service ethos and reorganised to generate maximum profits for shareholders, while the service loses out to private competition. I believe that the choice is an obvious one. Royal Mail should be considered a public service, and therefore it should be owned and governed as one. I believe that Royal Mail should be renationalised.