17 December, 2008

UK: the Post Office

When discussing the future of the Post Office / Royal Mail we should not forget the part played by Michael Heseltine. The old fraud could have sold off the Post Office at a profit years ago, when delivery companies were gearing up to meet the expected burgeoning of demand for home deliveries from internet purchases. But like every other decision he faced, he muffed it. There was talk of it being a meeting place for old people, as if that were any business of the State.

There is no reason why the State should own one means of communication - the most old fashioned - while the private sector runs all the others.

Now the Post Office loses 6p for every letter sent and its pension fund, helped downwards by Gordon Brown's removal of tax relief on dividends, is apparently £6bn in deficit.

The plan is to sell off one third (it should be all of it), insisting on single price delivery, even to the most remote areas, but guarantee the pension funds payments. This way the government gets to take what is in the pension fund (£20 billion apparently) to make the national debt look a bit lower, but of course saddle future generations with this vast liability.

The Tories should expose this sleight of hand, and insist that the whole thing is sold of, pensions shortfall and all, to the highest bidder, without any restrictions as to what the purchaser does with it. Without this daft idea we could have had public internet and fax points in every village by now, at a fraction of the cost.

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