Royal Mail may be viewed with a high level of affection by the public now, but will that still be the case after it’s privatised?
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Royal Mail has a new regulator, but its proposals fail to protect the service from privatisation and unfair competition
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Friday 28 October 2011 08.00 BST
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A Panorama programme on postal junk was compelling, but didn’t mention that the market is skewed against Royal Mail
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From the Guardian.
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From the Guardian.
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Visit our delivery offices, Mr Cable, and you’ll see how Royal Mail ‘modernisation’ is a disaster but there’s much worth saving here.
From the Guardian.
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From The Guardian
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It’s not a free market, it’s a rigged market, says Roy Mayall
The Hooper Report
When Peter Mandelson came on TV in May last year proposing the part-privatisation of the Royal Mail, he was very clear. Volumes are down, he said. People don’t send letters any more, they send texts and emails instead. The Royal Mail is under threat from the incursion of new technology into the communications business. It is all down to the market and to market choice.
The company he had in mind as the new potential co-owner of the Royal Mail was TNT, which had once been the Dutch national mail company.
TNT, of course, is one of any number of private mail companies vying for a place in the British postal market.
The impression we were being given was of an old-fashioned and beleaguered Royal Mail struggling with its more efficient rivals in an open market place.
The document that Peter Mandelson was basing his statements on was the Hooper Report.
The report makes a number of recommendations which are worth reviewing as they are still the basis of government policy. The Royal Mail has to modernise, but fast, it says. The CWU and Royal Mail need to get their act together and start being more cooperative. The government should take on responsibility for the pensions deficit in order to allow the company to concentrate on the modernisation process. A new regulatory regime is required to put the postal business in line with the rest of the communications market. And finally – and crucially – there should be a “strategic partnership” between Royal Mail “and one or more private sector companies with demonstrable experience of transforming a major business, ideally a major network business.”
These were precisely Peter Mandelson’s conclusions, although his plans for the part-privatisation were shelved – according to him – because of the weak condition of the market prevailing at the time. We might also add that there was an almighty outcry from the public, and from his own backbenchers, not to say, from Royal Mail staff and the CWU.
Plans for the sell-off remain in place, however, awaiting a change in “market conditions.”
All of this talk of “the market” makes you wonder.
Because when you take a close look at it, the market doesn’t exist. There is no market. It turns out to be little more than a propaganda tool used by the privatisation lobby to beat the Royal Mail over the head with.
In fact, the Royal Mail is in a very healthy state in terms of the profits it generates. Not only did it make £255 million in the first nine months of 2008 – a profit of over £1 million a day – but it also, through downstream access, generates massive profits for TNT and the other private mail companies too.
This is the issue that the Hooper Report fails to address: downstream access, the process by which private mail companies can crowbar themselves into the Royal Mail network, profiting from the system while undermining it. The Royal Mail is being regulated in order to allow the private companies to make a profit from it.
This isn’t a “free market”. It’s a rigged market.
What’s worse, according to Billy Hayes, general secretary of the CWU, the Royal Mail actually subsidises the private mail companies at the rate of about 2p per letter. So not only do they take the profitable trade away, leaving the Royal Mail with the expensive and hard to run universal service obligation, but the Royal Mail actually pays them to do this.
“I must make it clear, that the system used in the UK is not used in any other country,” Billy Hayes said, in a recent article. “It is uniquely bad.”
So what is going on here? The government can’t pretend that it is not aware of this. The members of Postcomm, the regulatory body which sets the prices, are all appointed by government, and I can’t imagine that Peter Mandelson, control freak that he is, does not insist upon being kept fully informed.
Not only that, but if you check out the Postcomm website you’ll see that members of the commission all have interests in private mail companies; either that or they are in the deregulation business. In other words, the people who the government appointed to look after the regulatory system are also the people who are rigging the market, for their own benefit.
It’s like the Royal Mail is being forced to enter the “Free Market Casino” against its will, only to discover that the roulette wheels are loaded, and that the dealers are all card-sharks.
None of this is mentioned in the Hooper Report, which also goes on to avoid a number of other issues. In particular, while it highlights the pensions deficit, estimated to reach £10 billion this year, what it doesn’t do is to tell us the cause of the deficit in the decades long pensions holiday which the company took, with full government approval, draining the coffers while allowing the workforce to pour our own hard-earned money into what was effectively a bottomless pit.
Finally the report makes what amounts to a threat. “Our recommendations are a package,” it says. “Each element of the package is needed if the universal service is to be sustained: modernisation achieved through partnership, tackling the pension deficit, and changing the regulatory regime.”
Or, to put it another way, the Hooper Report is a long drawn out ransom note with our pensions as hostage.
Give us privatisation, it says, or your pension gets it.
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Roy Mayall is a pseudonym for a postal worker who has been in the job for about five years and works in a delivery office somewhere in the south-east of England. He writes a blog at roymayall.wordpress.com
On You & Yours on BBC Radio 4 there was a discussion about Dear Granny Smith, featuring Billy Hayes of the CWU and Richard Hooper, author of the Hooper Report into the future of the Royal Mail. This is Roy Mayall’s response to that programme.
One of the things that has started to get to me since the publication of my book, Dear Granny Smith, is how often it is misrepresented in the press and by the media.
That was odd, because he played a short snippet from the BBC Book of the Week reading by Philip Jackson, in which, after a brief description of how the new Walk-Sequencing Machines work, the narrator quite clearly says, “and there’s not a postie in the whole world who would object.”
In another sequence Richard Hooper, author of the Hooper Reportinto the future of the Royal Mail, described the book as “a witty, mischievous, wonderfully nostalgic piece of writing”, but went on to describe it as “absolutely anti-modernisation, anti the modern way of doing things.”
Then he said: “But let’s get real, we all agree, Billy Hayes has just said it, the union agrees, the management agrees, the government agrees, that if we’re going to maintain our beloved universal postal service…. that the Royal Mail must accelerate its modernisation programme….” adding that the Walk-Sequencing Machines will “save the posties time, giving them more time to be out on delivery.”
This is precisely our fear. As if 3.5 hours is not already long enough to be working flat-out – 3.5 hours which generally turns into 4 hours, often more – now they want to put even more weight on our backs, even more time out on delivery.
You see, when Richard Hooper and the management of Royal Mail talk about “modernisation” it’s actually a euphemism. It doesn’t mean modernisation at all.
No postie would object to machines that took some of the drudgery out of our work, or which speeded things up, or which made the Royal Mail more efficient. This is the trick that is being played whenever anyone says that Dear Granny Smith is a nostalgic book – or as Billy Hayes, the General Secretary of the Communications Workers Union put it: “pining for the blue remembered hills” – that discussing past work conditions is being “unrealistic”, as if having time, having proper tea-breaks, good pay and conditions, time to do the job properly and not being worked like a pack-mule, were all unrealistic goals.
No. What “modernisation”, in the sense that management consultants and senior management at the Royal Mail mean it, is not modernisation. It is privatisation.
There is a passage in the book where I compare the lives of two postmen: one an old postman who started work in the 1950s, and the other, a younger family man, now in his 40s. The first, who I call “Tom”, now lives in happy retirement, having left the postal service a couple of years ago, while the other – “Jerry” – has only a lifetime of hardship to look forward to, and fully expects to be working for a privatised mail service by the time he retires.
And then I say:
You have to ask why this should be? What has changed in the last 50 years? Why is Jerry’s future so different than the one that Tom would have expected at the same age? How come Tom can rest in contented retirement, while Jerry only has a future full of hardship and uncertainty to look forward to?
Us postie’s haven’t changed. Jerry is as committed to his customers as Tom ever was. He is as dedicated, as honest, as straightforward, as hard-working, as decent, as kind. The post hasn’t changed. We still need the post. So why are the workers suffering in this way?
I guess you might say, “it’s the same for everyone. No one has any certainty any more.”
I guess that’s true.
But you still have to ask why? What is the driving force behind all these changes?
In the book I don’t answer that question, but I will try to here.
The driving force behind all these changes is something called neoliberalism. It is the guiding philosophy of the corporations. It basically says that nothing will exist on this planet – no human endeavour will take place, no plot of land will exist – that does not make a profit for them. Humans beings’ only purpose is to work for them. We are indebted to them through our mortgages, in the exact same way that serfs were indebted to the Lords in feudal times, and a portion of our labour will go to pay off our indebtedness in the same way that serfs were made to hand over a portion of their produce to the Lords.
In other words, what they have in mind for us isn’t “modernisation” at all. It is the exact opposite. It is a return to feudal serfdom.
Listen to You and Yours: 18/12/2009. The discussion on Dear Granny Smith is just over 29 minutes into the programme.
- BBC iPlayer – Book of the Week: Dear Granny Smith: Episode 1
Listen to Book of the Week: Dear Granny Smith: Episode 1