Royal Mail

Iain McKenzie Excerpts

Tuesday 25th June 2013 Westminster Hall

[Katy Clark]

The Government claim that Ofcom will regulate entrants into the postal services market, but there has been no attempt to prevent TNT cherry-picking in this way or to regulate the use of zero-hours contracts and other poor contractual conditions.

[Mr Iain McKenzie (Inverclyde) (Lab)]

I congratulate my hon. Friend on securing this very important debate. Does she agree that probably the first thing that the private sector would cut from the Royal Mail service is our unique Saturday delivery?

[Katy Clark]

I agree with my hon. Friend that that is indeed something that many people are fearful of.

Frankly, I say to the Minister that it is completely unacceptable to proceed to develop our postal services in this country in the way that TNT is operating at this time. We all know from our own experiences that if we allow sectors to offer poor conditions and poverty pay then it is the state and society as a whole that end up paying the price by subsidising bad employers. If the Minister is saying that his policy is not ideological, surely he must accept that allowing operators to come into the market in this way is highly damaging, both to the universal service obligation and to the public sector employer, which takes people on with better terms and conditions of employment. This cherry-picking of work is undermining the Royal Mail service and the universal service obligation.

If a privatised Royal Mail were to operate in a similar way, which we can only presume it would given that its main motive as a private company would be to maximise profits for its shareholders, then we can only expect it to try to cherry-pick, given that it has to compete with the TNTs of this world. This is incredibly bad news for our mail service.

--- Later in debate ---

[Mr Iain McKenzie (Inverclyde) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Davies. I congratulate my hon. Friend the Member for North Ayrshire and Arran (Katy Clark) on securing this debate. I suppose that I should declare an interest as the proud parent of a Royal Mail employee.

For me, this goes back to the 1980s, the last time a Conservative Government decided to go on a privatisation binge. I saw it up close, personal and at first hand when I was an employee of British Telecom and the Conservative Government at that time decided to sell it off, supposedly to make it leaner and more competitive. I saw job losses, closed depots and lost opportunities for a future generation to secure good employment in my neck of the woods.

Like the last time, these sell-offs have been driven by a desperate need for money to plug a gap left by failing Government policies and to pay for the rising number of unemployed. The current group of state-owned businesses proposed for privatisation could fetch nearly £9 billion, £3 billion of which would come from the sale of Royal Mail. The original rationale for privatising the Royal Mail was that it was making a loss. We now know that that is no longer true. Annual profits are up more than 60%, and figures show that the amount of mail being sent has risen.

Royal Mail still needs investment. The coalition’s policy does not make economic, political or social sense. Ministers are motivated by ideological blinkers and the desire to make a quick buck, not by the long-term best interests of the taxpayer, the Royal Mail or the public. Under privatisation, there will be no obligation to deliver the 26 million letters a day that Royal Mail currently handles. Service will worsen, especially in rural areas.

Red pillar boxes are a symbol of Britain and give people a connection to the past not only of the GPO and the Royal Mail, but of their own community. There are no Government safeguards to prevent the organisation from falling into foreign hands. Royal Mail is more than a business; it is a service. To cite only one of the services provided, I can identify our posties, who we see every day up and down the country. They do more than just deliver mail, and they go in early to set out their walks and deliver their full mail sack; some of the private sector firms, however, after too much time into the day will take the mail back and not deliver the full amount. Posties are the ones who we see in the community and who are recognised as part of the community; they are the ones who see that the curtains are still closed and that the milk is on the doorstep. They provide more than a mail service; they are part of the community, which would not be the case under privatisation.