Saving the local Post Office from closure, and the Royal Mail from privatisation, has long been a serious issue on the campaign trail for traditionalists and progressives alike.
At this time – when private banks have ceased lending to sound customers and many urban and rural areas are excluded altogether from essential public utility services – these causes take on a more acute tone. At the risk of schadenfreude at Labour’s calamitous handling of these essential institutions, let’s examine just how the government’s proposals for the postal service fail to deliver (apologies, I couldn’t help it!).
Hardly anyone would deny that the Royal Mail faces pressure to modernise and to compete with commercial services, and that to keep pace with an ever-changing communications landscape some restructuring is required. The question is how this is best achieved, how to prioritise disparate facets of the service from universal postal coverage to banking and civil services.
According to the accepted Westminster doctrine, established some 15 years ago and remaining today, competition is the key. Ask the Royal Mail to compete for business with private sector providers and its efficiency will increase, the customer will win.
The problem is, private sector providers are able to cherry-pick juicy corporate contracts and profitable speciality deliveries, leaving the public sector to ensure that Mrs. Jones’ birthday card gets from Weston-super-Mare to Wick on time and intact. Not only this, the underfunded Royal Mail has little capacity to invest in modern infrastructure and facilities.
As befits the current administration, their response is to part-privatise the Royal Mail and sell off hundreds of Post Offices, hoping that the private sector will still serve communities whilst turning a handy profit. Unsurprisingly this is not a popular proposal; so much so that as many as 150 Labour MPs are expected to vote against their own party’s policy, risking turmoil for an already beleaguered leadership.
As far as the Conservatives are concerned Labour’s policy doesn’t go far enough, some Tory MPs favouring a complete sell-off; however they may still support a part-privatisation in the knowledge that they can always complete the job themselves in a few months time.
To avoid the embarrassment of relying on Tory votes to pass this reform into law, a desperate Downing Street scramble has unfolded in the last few days, with Compass chair Neal Lawson apparently failing to get the rebel MPs to agree on a not-for-profit model for the Royal Mail along the lines of Network Rail. Without this compromise the government must steel itself for defeat, potentially scuppering the chances of both postal reform and of Gordon Brown lasting until next June as PM.
So what of the Liberal Democrats – how would we do things differently?
