Royal Mail

Debate between Baroness Clark of Kilwinning and Lisa Nandy

Tuesday 25th June 2013 Westminster Hall

[Katy Clark]

The hon. Gentleman puts his point well. I will now move on to discuss some of the issues relating to Royal Mail itself, because I think that we have fully explored some of the challenges that the post office service will face if this privatisation goes ahead.

Since the legislation was passed, the Government have taken a considerable number of steps to prepare Royal Mail for privatisation. Royal Mail Holdings Ltd, as it is now known, is currently a 100% publicly owned UK-wide company, which was established as a sister company to the Post Office. This restructuring took place as part of the preparation for privatisation. A legal framework has been created that makes Royal Mail responsible for the collection, sorting and delivery of letters and parcels under a universal service obligation. The Government have indicated that they intend to sell shares in Royal Mail in the financial year 2013-14. Indeed, in a written statement in April, the Minister said that the Government would proceed with the sale of shares at what he called a fair commercial price.

[Lisa Nandy (Wigan) (Lab)]

I am grateful to my hon. Friend for giving way, and I congratulate her on securing this debate. Earlier, she made a compelling case about who stands to lose from the Government’s sell-off of Royal Mail, but I am pleased that she has turned her attention to who stands to gain from it. Does she share my concern that the Government are refusing to answer questions from my hon. Friend the Member for Edinburgh South (Ian Murray) about the involvement of Goldman Sachs and UBS, and that—despite repeated requests under the Freedom of Information Act—they will not reveal the fees that Goldman Sachs and UBS stand to make from the sale of Royal Mail?

[Katy Clark]

I am very grateful to my hon. Friend for that intervention. Indeed, that was one of the questions that I was going to ask the Minister, and she has saved me from putting it to the Minister in my speech. I very much hope that he will address that issue when he responds to this debate.

In the Minister’s letter to all MPs dated 17 May, which enclosed a copy of a speech that he had made to the Policy Exchange, he stated that the Government’s policy was not ideological and a number of assurances were given to MPs. It would be useful if he could provide the House today with a great deal more information about what the Government plan to do and how many shares they will sell off.

Royal Mail is unique in the UK postal market in that it is the only universal service provider. The 2011 Act has enabled a regulatory framework to be created, so that persons are automatically entitled to provide postal services provided that they notify Ofcom and comply with the conditions set by that organisation. This is a serious threat to Royal Mail, as competitors are now entering the end-to-end market.