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| Row grows over Royal Mail plans | Row grows over Royal Mail plans |
| (10 minutes later) | |
| Postal workers are preparing to protest in Westminster as the row grows over plans to sell off 30% of Royal Mail. | Postal workers are preparing to protest in Westminster as the row grows over plans to sell off 30% of Royal Mail. |
| The plan, set to be unveiled in a bill to Parliament on Thursday, is also opposed by 122 Labour MPs. | |
| Unions and MPs reacted with anger to the publication of a letter warning the Royal Mail pension fund was at risk. | Unions and MPs reacted with anger to the publication of a letter warning the Royal Mail pension fund was at risk. |
| Gordon Brown may face the largest backbench rebellion of his premiership and have to rely on Conservative and Lib Dem votes to get the bill through. | Gordon Brown may face the largest backbench rebellion of his premiership and have to rely on Conservative and Lib Dem votes to get the bill through. |
| Ministers want to sell a stake of about 30% to the private sector to help pay for the modernisation of the service but the plan faces opposition from many Labour MPs. | Ministers want to sell a stake of about 30% to the private sector to help pay for the modernisation of the service but the plan faces opposition from many Labour MPs. |
| Rebels warned | Rebels warned |
| In a letter seen by BBC News, Jane Newell, the chair of trustees of Royal Mail's pension scheme warns the deficit is "significantly larger" than the £5.9bn in the Hooper Review - which called for a minority stake in the business to be sold off. | In a letter seen by BBC News, Jane Newell, the chair of trustees of Royal Mail's pension scheme warns the deficit is "significantly larger" than the £5.9bn in the Hooper Review - which called for a minority stake in the business to be sold off. |
| She said its deficit was likely to rise well in excess of its current £5.9bn should the sale not happen, with potentially "devastating consequences" for the business. | She said its deficit was likely to rise well in excess of its current £5.9bn should the sale not happen, with potentially "devastating consequences" for the business. |
| The government has proposed taking over responsibility for the pension scheme as part of the proposed sell-off package. | The government has proposed taking over responsibility for the pension scheme as part of the proposed sell-off package. |
| The letter's publication will be seen by some as a warning to potential rebels about the consequences of any opposition. | The letter's publication will be seen by some as a warning to potential rebels about the consequences of any opposition. |
| The question is, by bringing in the private sector, don't you open the door to full-scale privatisation in the future? Peter HainFormer cabinet minister Send us your comments | The question is, by bringing in the private sector, don't you open the door to full-scale privatisation in the future? Peter HainFormer cabinet minister Send us your comments |
| In December, Business Secretary Lord Mandelson said Royal Mail could not survive in its current form, due to severe financial constraints and falling demand for sending letters, and needed fresh investment in technology to prosper. | In December, Business Secretary Lord Mandelson said Royal Mail could not survive in its current form, due to severe financial constraints and falling demand for sending letters, and needed fresh investment in technology to prosper. |
| He denied the plan amounted to a sell-off of the business, saying it would be a "partnership" which maintains Labour's manifesto commitment to keep Royal Mail in public ownership. | He denied the plan amounted to a sell-off of the business, saying it would be a "partnership" which maintains Labour's manifesto commitment to keep Royal Mail in public ownership. |
| 'Unpopular' | 'Unpopular' |
| But unions will stage a mass protest on Tuesday against the plans, which they say are "deeply unpopular". | But unions will stage a mass protest on Tuesday against the plans, which they say are "deeply unpopular". |
| "We urge the government to take responsible action and respond to the justified concerns of UK citizens who do not want to see this valuable public asset carved up," said Billy Hayes, general secretary of the CWU union. | "We urge the government to take responsible action and respond to the justified concerns of UK citizens who do not want to see this valuable public asset carved up," said Billy Hayes, general secretary of the CWU union. |
| Unions say Royal Mail made a profit of £255m in the last nine months of 2008, is healthy and can thrive in its current form. | Unions say Royal Mail made a profit of £255m in the last nine months of 2008, is healthy and can thrive in its current form. |
| Business Secretary Lord Mandelson speaking about the plans in January | Business Secretary Lord Mandelson speaking about the plans in January |
| But Postal Affairs Minister Pat McFadden told the BBC the pension fund deficit was 75 times the company's profit and Royal Mail could not afford to pay down the deficit and fund the modernisation the company needed. | But Postal Affairs Minister Pat McFadden told the BBC the pension fund deficit was 75 times the company's profit and Royal Mail could not afford to pay down the deficit and fund the modernisation the company needed. |
| He said many European postal firms had automated a lot of their services which saved them money and made them more efficient. | He said many European postal firms had automated a lot of their services which saved them money and made them more efficient. |
| "We will not privatise the company but what we want is to bring in the experience to drive forward that change precisely so we can continue the universal service for the future," he said. | "We will not privatise the company but what we want is to bring in the experience to drive forward that change precisely so we can continue the universal service for the future," he said. |
| 'Political suicide' | 'Political suicide' |
| Union leaders and MPs are worried about the threat to jobs and the impact of private sector involvement on the Royal Mail's "universal service" obligation to deliver mail to every UK home. | Union leaders and MPs are worried about the threat to jobs and the impact of private sector involvement on the Royal Mail's "universal service" obligation to deliver mail to every UK home. |
| Michael Connarty described the plan as "political suicide" while John McDonnell said it would result "in significant job losses and attacks on the working conditions of postal workers". | Michael Connarty described the plan as "political suicide" while John McDonnell said it would result "in significant job losses and attacks on the working conditions of postal workers". |
| Former cabinet minister Peter Hain has signed a motion opposing the move. He told BBC Radio 4's Today programme: "The question is, by bringing in the private sector, don't you open the door to full-scale privatisation in the future? How would the public interest be protected with a private sector partner?" | Former cabinet minister Peter Hain has signed a motion opposing the move. He told BBC Radio 4's Today programme: "The question is, by bringing in the private sector, don't you open the door to full-scale privatisation in the future? How would the public interest be protected with a private sector partner?" |
| He said, if the bill went to MPs in its original form, the government would have "a problem" in terms of winning over a sufficient number of MPs. | He said, if the bill went to MPs in its original form, the government would have "a problem" in terms of winning over a sufficient number of MPs. |
| "There's big opposition amongst Labour MPs who don't like part privatisation and big opposition amongst Tory and Lib Dem MPs who want full privatisation," he said. | "There's big opposition amongst Labour MPs who don't like part privatisation and big opposition amongst Tory and Lib Dem MPs who want full privatisation," he said. |
| Ministers say they are committed to the universal service but argue that Royal Mail is less competitive than its European counterparts and needs to improve its performance in order to safeguard its long-term survival. | Ministers say they are committed to the universal service but argue that Royal Mail is less competitive than its European counterparts and needs to improve its performance in order to safeguard its long-term survival. |
| They have also called for a "fresh start" in industrial relations after 2007's damaging strike which cost it millions of pounds. | They have also called for a "fresh start" in industrial relations after 2007's damaging strike which cost it millions of pounds. |
| Dutch postal operator TNT is the only firm, so far, to have publicly expressed interest in buying a chunk of Royal Mail. | Dutch postal operator TNT is the only firm, so far, to have publicly expressed interest in buying a chunk of Royal Mail. |