In the Postal Services Act 2011, the Coalition government split Royal Mail from the network of Post Offices branches, which traders as Post Office Ltd.
Post Office Ltd is to remain in the public sector, because it is dependent upon a subsidy from the government – £103 million in the last year.
Separation makes the Post Office network very vulnerable. A privatised Royal Mail will not wish to prioritise the use of loss-making public company,
A ten-year commercial agreement was struck between the two companies on January 2012. But the Department of Business, Innovation and Skills has accepted that the contract allows for changes in commercial circumstances, and it contains a review clause after five years.
This is surely an invitation for a privately owned Royal Mail to look at other private retailers instead of Post Office Ltd.
Already Royal Mail will be ending the provision of IT and finance services to the Post Office by the end September 2014.
No where else in the world has this separation beem made.
Make no mistake – what ever assurances the Coalition government is now offering, Post Office branches are under serious threat.
A third of Post Office revenues – around £350 million a year – come from Royal Mail.
In London, the proposed reforms have the potentially disproportionate impact on Londoners, as six Post Offices have been identified for outright closure, as part of a plan to close or franchise 76 crown Post Offices.
Rural Post Offices are particularly at risk. Only 23% of these offices generate more than £40,000 pounds revenue a year.
Equally, in many poorer wards in urban centres, the local post office plays a crucial role in sustaining small businesses in their vicinity.
The Coalition government could have introduced a statutory obligation for Royal mail, as the universal service provider, to use local Post Office branches
But it didn’t. Now we must campaign to ensure a future for the Post Office network. This can only be achieved if we defeat privatisation.
In 2015 our Labour government will have to reintegrate the Post Office network into a publicly owned Royal Mail. Otherwise there is no guarantee for the future of your local Post Office.
This is an ideologically driven privatisation that not event Margaret Thatcher would consider. That is what we are deal with this coalition government.