I sometimes think there’s a special relationship between postal workers and dustmen. We deliver the rubbish, they take it away again. We used to get paid per item for the junk mail we dropped through your letter box. These days we get a delivery supplement: a fixed amount per week no matter how many advertising leaflets we carry. The maximum we are allowed to deliver has also increased, to seven per household.
It’s the one thing I disagree with my union about. They say that this unaddressed mail – we call it ‘door-to-door’ – is necessary because it helps to pay my wages. I say I’d rather not be involved in delivering unwanted advertising to people who will throw it in the bin without a second glance.
There are better things we could be doing: the ‘Call and Check’ scheme developed in Jersey, for example. For the price of a special delivery letter, postal workers will knock on your door and have a brief chat, to make sure you’re all right. We can check if you’ve taken your medication, or find out if you need additional services, such as a lift to the shops, or someone to pop in for a visit. If you say yes, we’ll pass this information on to social services, the NHS or a local voluntary organisation.
We could also deliver repeat prescriptions, collect post on your behalf, remind you about hospital appointments, or supply information on available services. Postal workers would be required to go through a police check and given first aid training.
Call and Check visits can last from two to ten minutes, and the postie is supported by a customer service team, who liaise with the associated agencies and make sure that the information is co-ordinated between the different parties.
The scheme has been so successful in Jersey that, after a pilot in one area, it has been rolled out in many parts of the island. It is also being trialled in Finland, Iceland and Ireland and is being considered in the United States.
I’ve known since my early days as a postal worker that we are a lifeline for some people, albeit on a casual basis. I already collect mail for one 96-year-old and I’m always on the alert when I reach certain doors. Call and Check would formalise the arrangement and offer me the proper training and support.
It wouldn’t be hard to administer. We already put markers in our frames to show if there’s been a repeat complaint, or if someone has opted out of door-to-door. A card to remind us to call on a particular customer could be loaded into our frames on the appropriate days, with all the necessary information included.
Of course, such a scheme would involve the postal worker being responsible for a single round, which goes against the privatised Royal Mail’s philosophy of making us interchangeable cogs in a machine, who can be moved at a moment’s notice. It would make us what we used to be, valued and trusted members of the community, instead of the mere carrying devices for advertising that we’ve become.
I started working for the Royal Mail sometime after the turn of the Millennium. It was a job I had always wanted. Healthy, out in the fresh air, involving at least four hours a day of intense exercise, and a degree of autonomy, with no managers looking over my shoulder – at least while I was out on my round – it was the perfect job. Still is in many ways.
The basics of the job haven’t changed. I still walk from one address to the next sticking letters through letter boxes. What can possibly go wrong? Well a lot actually. They can destroy the industry by undermining the pension, introducing a form of fake competition, and then privatising it. Competition was introduced in the wake of the third EU Postal Services Directive of 2008, which required all postal markets to be opened up to other companies.
I say ‘fake competition’ because how can you introduce real competition into what is, in its essence, a natural monopoly?
Never has there been another piece of literature as ephemeral and touching as ‘Dear Granny Smith’.
With the loss of the traditional ‘Postie’ we also lose a precious part of ourselves. That part that remembers peoples names and birthdays. That part that never fails to bring us news from our loved ones when it rains and when it snows, when its sunny and when its cold. That part that has been there since the moment we are born, that watches us as we grow up, go to school and eventually leave home. That same part that experiences the same joy our families and loved ones feel when we write home.
‘Dear Granny Smith’ is sign of the times, but it is also a reminder that every single day there is someone on the other side of the door that knows us perhaps more than we know ourselves…
I laughed, I cried, my goodness Roy tells it as it is. I’ve been a postie for many years now and he tells us how it use to be to how it is now, the service is being ripped apart with managers at the helm who have not a clue to what our job is. I still care about my job and my customers it’s just Royal Mail is about money now. Well it’s about time the bosses understand we work for the community that we deliver to not just the company. Royal Mail, I would like to thank Roy for the book and telling all how it is, this is worth reading. It will give you all a honest insight into the goings on and what your postie is having to deal with. If you care and use the service protect what you have or else it will be gone!
I worked for Royal Mail for thirty four years. I’ve sorted mail, delivered mail, despatched mail, been rained on, been bitten by dogs, pursued by a violent gang of robbers, disciplined for minor indiscretions, stressed out and suicidal at one point. Every sentence in this wonderfully accurate book is absolutely true; it sums up just about every Royal Mail workplace in the country. I know this from bitter experience, as later in my career I left the streets and held a senior union position which afforded me the privilege of representing postmen and postwomen over a wide geographical area. Roy Mayall is someone I met every working day of my life. I’ve also met everyone of his workmates, every customer and every myopic manager, who, if they were honest (or brave) enough to speak out, could testify to the authors account of an industry being relentlessly torn apart.
This book is a “must read” for anyone who cares about public service, society, community, greed, and corporate interference.
This amusing little gem is a timely reminder of just how much so-called progress chips away at the positive aspects of our day-to-day life and often not for the better.
Streamlining a business like the Royal Mail has a human cost. “Roy Mayall” writes an warming and amusing account of how progress can often mean one step forward for the business and two steps back for employees and customers, cutting bonds in our society which have existed for over a century. One signal message for me was that we really do not pay enough to post a letter. For 30 pence a letter makes the journey from one end of the country to the other in a couple of days and in my experience very rarely goes astray – once in 60 years if I remember correctly. Try offering someone thirty pence to deliver a letter for you to the next town and be surprised if they say “Yes”. A very enjoyable read which slips easily into a handbag or pocket.
I bought this book this week and read it in an hour or so. As a Postman of 7 years I agreed with every word written. Roy has told the story of what has happened to Royal Mail. It is now a target driven machine with incompetent managers and senior directors running it. They come, do their little pep talk, bang their drum and behold they are gone. The job has changed so much in the few years that I have been working for RM. None of it for the better. This is a must read for every Postman or woman and if everyone who wants to know what’s wrong with the mail – just read this book. You will cry!!
If I had the money, I’d arrange for everyone in the country to have a copy of this book. It describes, in a concise and wryly humorous way, the consequences of a purely profit-driven mindset replacing a human-centred mindset. And it could be talking about any of the large organisations (look at the NHS!), where managers now seem to manage by spreadsheet – and who no longer manage ‘people’ but ‘human resources’ or ‘human capital’ whose job is to follow orders and concentrate on ‘hitting targets’. Well done, Roy Mayall, for telling it how it is – now what can we, the Granny and Grandpa Smiths, do about it?
This book is the most accurate account of what It’s like to be a postman. Being a postman myself I can understand the frustration has we fight to keep our much loved postal service in Public hands. We have one of the cheapest and best postal services in the World, but with the present management dogma of cost cutting at the expense of quality, we know where it will lead. This book is witty and honest, even if your not interested in the postal system people will be able to relate to these modern management practises within their own jobs. First class book.
I first came across this on radio 4 in serialised form and decided I had to have it in my collection. Very informative, a real hoot, humorously a Sad condemnation of today’s Post Office Management. This should be compulsory reading for every Politician in our so-called Government. I take my hat off to this Author.
I started working for the Royal Mail sometime after the turn of the Millennium.
It was a job I had always wanted. Healthy, out in the fresh air, involving at least four hours a day of intense exercise, and a degree of autonomy, with no managers looking over my shoulder – at least while I was out on my round – it was the perfect job. Still is in many ways.
The basics of the job haven’t changed. I still walk from one address to the next sticking letters through letter boxes. What can possibly go wrong?
Well a lot actually. They can destroy the industry by undermining the pension, introducing a form of fake competition, and then privatising it.
The pension was undermined between 1990 and 2003 when the company took a pensions holiday, failing to pay its share into the pension pot. They could not possibly have done this without the agreement of the government. This left an £8bn pension deficit, later rising to £10bn, which the government used as a way to begin the privatisation narrative. Look, the Royal Mail is failing, they said: we need to privatise it. It nationalised the liability – taking the pension deficit in-house – while beginning the process of selling off the assets on the cheap to its mates in the private sector.
I say ‘fake competition’ because how can you introduce real competition into what is, in its essence, a natural monopoly?
The Royal Mail – or Post Office as it was more commonly known – had only ever been in the public sector during its entire 500 year history. It had created the whole distribution network – the systems, the methods, the procedures – as a seamless unity. Indeed, there’s a good argument to say that the Royal Mail is responsible for the creation of our modern-day nation. It brought together the different parts of the country by giving everyone an address and a post code, accessible to all for the price of a single stamp.
How can there be real competition when one company, and one company alone, is required, under the Universal Service Obligation (USO) to deliver to every address, no matter how remote, in the whole of the United Kingdom: not only from Land’s End to John o’Groats, but from the Scilly Isles to the Outer Hebrides, from the Isle of Wight to the Isle of Man?
It’s easy to make a profit delivering from city to city, from London to Manchester to Glasgow, or from district to district inside the same city: much harder if you take in all the towns and villages as well; almost impossible if you include every isolated cottage, croft or farmstead in between. Only the Royal Mail is obliged to deliver to all of these.
The way they engineered the competition was through a process called ‘downstream access’. Previous privatisations gave access to the industry network – the electricity grid, the water pipes or the gas pipes – to all the rival companies on an equal basis.
In the case of the postal industry the equivalent of this was us: the postal workers on our rounds.
So the Royal Mail’s rivals were allowed to bid for the bulk mail and city-to-city contracts of all the main services – the banks, the utilities, the NHS, Amazon, eBay and all the rest – and then expect us to deliver it for them.
In other words, in this industry, me and my labour – my living, breathing, heart-pumping, energetic body – is viewed as the equivalent of the tangles of copper wires or the networks of underground pipes that serve as the infrastructure in other parts of the economy.
Even then the other companies would have been unable to make a mark. The Royal Mail was too big and too well-established. It could have crushed the other companies underfoot. So the government introduced a principle called ‘headroom’. When the Royal Mail charged the other companies for its downstream access services, it was obliged to leave financial space for them to make a profit.
So there was never a ‘free market’. It was a highly regulated market from the outset: that is, the Royal Mail was regulated in order to allow the other companies the freedom to compete with each other.
And then there was privatisation, which took place in October 2013, as I’m sure you all remember.
Part of the justification for this was that people’s habits were changing. People didn’t send letters any more: they sent emails and texts instead.
If you listen to the Royal Mail, they will tell you that there has been a 40% drop in mail volumes in the last ten years. This might be true, although there does seem to be a marked increase in advertising mail at the same time. But the one thing they failed to mention was the increase in packets. The same technology that has effaced the ancient and noble art of letter-writing – never something the majority of the population engaged in anyway – has also, at the same time, allowed us to buy our goods online.
This has been by far the greatest shift in the industry since the onset of the digital revolution: the sheer number of packets we carry, a much more profitable enterprise.
I can’t believe the government hadn’t predicted this when they decided to sell off the Royal Mail, or that experts in the industry weren’t already aware of it.
In other words, it’s been one giant-sized con from beginning to end.
The other element that comes into this has been the separation of the Post Office from the Royal Mail.
The Post Office has always made a loss. The Royal Mail has always made a profit. By retaining the Post Office in public hands, while selling off the Royal Mail, they’ve ensured ever increasing profits for the private sector, and ever increasing burdens for the public.
There’s been extraordinary pressure on Post Office Ltd, the government owned company that runs the counters that sell you your stamps, to cut costs and make efficiency savings. What this has meant is that post offices are being franchised out into supermarkets, where the staff are paid at retail trade rates under minimum hours contracts, rather than the well-paid and secure jobs that skilled post office workers used to command. The Post Office is no more than a minor adjunct of the retail industry these days.
Most post offices are also grossly understaffed, which has meant massive queues this Christmas… and for all Christmases to come, unless the industry is brought back together again.
I’ve called this piece ‘The Year They Privatised Christmas’. That’s because the Royal Mail was always an integral part of the Christmas story.
Still is. We deliver all your Christmas cards and most of your parcels. All holiday rights are cancelled for the season, and most postal workers – at least in the past – were willing to go into serious levels of overtime to get the job done. Our MP always comes down to the office to congratulate us on our work. We are like modern day Father Christmases in our red vans, wrapped up against the cold in our red fleeces, delivering presents to your door.
By privatising the Royal Mail the government has effectively privatised Christmas.
It has turned me into a mere utility: an overground delivery system without a will of my own.
The management may not be looking directly over my shoulder, but they make me carry a PDA – a ‘postal delivery assistant’: effectively a tracking device – which tells them where I am and where and am heading every minute of the day.
They make me work harder and faster for the same basic wage. They are constantly ratcheting up the pace and the work load, to make sure I do more work in the same number of hours. They have degraded me and degraded my job in order to squeeze out more profits for their shareholders.
So you won’t be surprised to hear that most of the good will is gone. Postal workers are less and less likely to go into overtime. We are less and less likely to want to do management any favours.
That’s why we voted so overwhelmingly to strike in October – 89.1 per cent in favour on a turnout of 73.7 per cent – not only to secure our pensions and our jobs, but also to secure the future of the Royal Mail – and Christmas! – for all.
Today is the last day for sending first-class post if you want it to arrive before Christmas. You’re lucky there’s anyone to deliver it. In October, the Communication Workers Union held a ballot which came out overwhelmingly in support of strike action – 89.1 per cent in favour on a turnout of 73.7 per cent – but the Royal Mail got a High Court injunction to stop the strike.
If you believe Royal Mail, letter volumes have declined by 40 per cent in the last ten years as people have increasingly taken to email. But there doesn’t seem to be any noticeable loss from where postal workers are standing. In fact, volumes are as high as they’ve ever been. It’s true that people don’t write so many personal letters any more – that was always a minority interest anyway – but the loss of personal mail has been more than compensated for by a marked increase in advertising mail. I’m sure you’ve noticed it too.
It’s a joke in the office. ‘Figures are down,’ we say, while loading all those extra bags into the back of the van. And it’s here we see a really strange thing in the conduct of the postal industry in the UK. There are just as many letters as there were before privatisation, but many of them are now ‘handled’ by rival mail companies like UK Mail and TNT, who, while they take the profit for handling it, don’t actually deliver it. We deliver it. Yes, that’s right: the Royal Mail delivers its rivals’ mail. Management tells us that if we go on strike it will strengthen our rivals, but without us, our rivals can’t exist.
The rival mail companies are allowed to use Royal Mail staff and equipment to deliver their post, through a process called ‘downstream access’; at the same time, none of them is hampered by the Universal Service Obligation, which requires the Royal Mail to deliver to every household in the country, no matter how remote.
Meanwhile, the privatised Royal Mail is now under an obligation to increase profits to pass on to shareholders. What this means is that there is growing pressure to cut costs, to deliver the same amount of mail using fewer staff.
The way they achieve this is through a process called ‘lapsing’. What they do is to break down two or three rounds in the office into their constituent parts – they ‘collapse’ the frames – thus saving on the wages of the workers who would otherwise have delivered those rounds. They then hand the extra bundles on to the rest of us to deliver.
Which is fine on a light day, but these days we lapse almost every day; and because of the pressure to cut costs there is no longer any spare capacity in the office. There aren’t enough staff, and if something unexpected happens, like one or two people going off sick, or a surge of mail, there isn’t the man-power to cope. This is when mail gets left behind. This is when third-class mail is given priority over first-class.
Which is what happened recently. There was a last-minute surge of mail, including a significant quantity of first class letters. Well, I say ‘last-minute’. It was last-minute as far as delivery staff were concerned, but the management, who brought it in from the lorries, and the people who run the sorting machines, must have known it was there all along.
There were howls of protest from the staff. How are we going to sort and deliver this, and take out the lapsed mail?
That’s when I heard something I’d never heard before in all my years as a postman: instead of dropping the lapsed mail, some of which was just the third-class advertising junk known as Mailsort, we were told to leave the first-class mail under our desks.
You may ask why they did this. And the answer is: I have no idea. But I can take an educated guess. It was about saving money. They didn’t have anyone to take out the lapsed mail, so, rather than bring in casual workers, which would have cost them, they decided to delay the first-class mail instead.
None of this happened when we were publicly owned. First-class mail was always given priority, and most postal workers were willing to go into overtime to get it delivered. Not any more.
I went to London on the train the other day. It was my day off.
I like trains. I like the sense that I am being carried, that someone else is doing the driving for a change. You can relax on a train. You can look out of the window at the world going by. Even the world looks relaxed somehow. It looks serene, unperturbed, just going about its daily business as it drifts by through the window like a moving picture. It’s like you are looking at the world from a new angle, uncluttered by the debris of modern life.
Just think of the difference between the view from a train and the view on the motorway. There are usually several lanes between you and the world on the motorway. Even if you drive on the inside lane, there’s the hard shoulder and a wire fence in the way. It’s like that fence is dividing you from the world. Not that you have time to look. You are too busy looking at the traffic, too busy worrying what the other drivers might be up to. One slip and you could be dead.
Now think about the train. It’s true that there’s a verge and a fence, but you don’t feel cut off in the same way. The verge is full of trees and plants and wildlife. You feel as if you are a part of the landscape. The world has grown up to accommodate the train. The towns and cities you pass through have nestled themselves around the lines, absorbing them, incorporating them, so that the railway has become an expression of the town’s character. Can you say the same about by-passes and out-of-town shopping malls I wonder?
If transport had never evolved beyond the train, I would not be unhappy. On a train, you don’t take the journey, the journey takes you.
I like other forms of transport too. I like bikes, I like buses. I can imagine a world in which all of these forms of transport are spliced together to form one, unified, effective, cheap, safe and reliable transport system, and I would never have to suffer the stress of motorway driving again.
But, then again, I’m old fashioned. Sometimes I like to remember the world I grew up in, a world that actually worked, as opposed to the one we have now, which seems to stumble on from one mad crisis to the next, regardless of its apparent modernity.
It’s not that I’m against change. I like change.
I remember the first time I discovered predictive text on my mobile phone.
It was my son who showed it to me. He showed me how to use it, patiently taking me through the process: how to read the keyboard, how to change the words, how to find the address, how to send it off. My son became my teacher, and that was a revelation in itself. He’s been teaching me ever since. We sent a text to his mother, who was in Turkey at the time. And within a minute I’d got a reply. I fell in love with my mobile phone in that instant. What an incredible facility to possess, to contact anyone anywhere in the world, and to get an immediate reply.
I love computers, and the internet, and websites and Google Earth and digital cameras and have a huge hankering after a Tablet one day. They look like the embodiment of contemporary magic to me.
But for every innovation which enhances the world, there are a dozen more which make no sense whatsoever.
As I was saying, I was travelling up to London on the train, and I needed to go to the toilet.
I don’t know what the toilets on trains are like in your part of the world, but in my part of the world they are these huge imposing oval shaped rooms taking up about a quarter of the carriage. They fill up so much space that there’s hardly any room for seats nearby. Not that you would want to sit nearby, as they smell. And instead of door handles they have a button. The button flashes when the toilet is empty, but goes out when the toilet is occupied. Or maybe it’s the other way round: maybe it flashes when the toilet is occupied and goes out when it’s empty. It’s hard to remember. You press the button and the door swings open. You press one of the buttons inside the toilet and the door swings shut. Well I say “swings”, but that makes it sound smooth. It is anything but smooth. Rather, the door cranks its way open, juddering as it does so, making a sort of grinding noise along the way.
And on this occasion the door cranked and juddered open to reveal a woman with her child in there. The child was having a pee, his legs pressed up against the toilet, while the woman was behind, holding his rucksack and steadying him against the movement of the train. The two of them looked at me uncomfortably. It was an awkward moment.
“Sorry,” the woman said. “We forgot to lock the door.”
See, this is the kind of innovation that makes no sense whatsoever. Instead of a catch there is a series of buttons. There’s a button for opening the door, and a button for closing the door, and a button for locking the door – there’s even a button for flushing the toilet – and it’s an easy thing to think that having closed the door you have also locked the door. And when you do lock the door a remote woman’s voice echoes around the space. “The door is now locked,” she says. She doesn’t tell you that the door is unlocked, only that it is locked. Why would I want a woman in the toilet with me telling me that the door is locked? What’s wrong with a catch? In the old days you closed the door, and you put down the catch. It was obvious when the door was locked and when it was not.
Ten years ago, these toilets were considered very modern. These days they are the height of decrepitude. What happens when they break down? They are always breaking down. The toilet is incorporated into the carriage and is full of complex electronics. When it breaks down the whole of the carriage is put out of commission. It takes an electronic engineer to fix it. It probably has to be hauled off to a workshop. Compare this to the old days. What used to happen when the catch broke? You got someone with a screwdriver to come and fix it.
The reason the new toilets take up so much space is so that the oval shaped door can slide neatly along the oval shaped wall, allowing the automatic mechanism to open the door for you, rather than you having to open it yourself. Get that? It’s so you don’t have to open the door yourself.
Who thought of that? Who thought it would be a good idea to have doors which open themselves?
They are everywhere: doors which open themselves. They are in every supermarket and every bank. Every building society, every corporate building. Every shopping mall. You come to a door and instead of opening it you either have to press a button or you have to wait for it to open itself.
Are we so enervated as a species that we can no longer open doors? Are we so weak that the process of pulling or pushing a door to get it open takes up too much energy and thought?
We always managed to get doors open in the past. What has changed? Maybe the process is too intellectually challenging for our feeble brains to cope with? Would we stop, puzzled, at the threshold of every door wondering what to do without the aid of the automatic mechanism to help make the decision for us?
It’s like someone somewhere has decided that we need to have an army of invisible butlers everywhere we go, opening and closing doors for us.
We can’t afford to have real butlers but we can at least have a mechanical butler everywhere we go, opening and closing the doors.
I suppose doors which open themselves could be quite useful if you were weighed down with heavy bags, or you were pushing a pushchair or someone in a wheel chair. That must apply to a certain percentage of the population for a certain percentage of the time. But we had a method for dealing with people in this kind of predicament in the past, before we had doors which opened themselves. It was called politeness. Someone else would open the door for you. This had the advantage that you got to talk to someone in the process, something which, as yet, you can’t do with an automatic door.
There is also something called a power-assisted door. This is the most confusing kind of door of all. It looks like an ordinary door, but it’s not an ordinary door. It’s not quite an automatic door either. It’s like a combination of the two.
There’s one of these in my building society. It first appeared there over ten years ago now, and I’ve still not got used to it.
There’s a variety of ways to make it open. There’s a button on the window. If you touch the window the door will open. Also if you begin opening the door in the ordinary way, it will continue opening by itself. It will suddenly leap from your hand and yank itself open. This is very disconcerting. It’s like someone has suddenly pulled the door away from you. For a time people would fall through the door rather than stepping through it. They would stumble through the door wondering what just happened.
The puzzling thing about all of this is who decided to make the world this way? Who decided we needed doors which open themselves? I don’t remember being asked about this, do you? I don’t remember there being a referendum on the matter. I mean: I can imagine a million more useful things I would like to have than doors which open themselves. I’d like cheaper fares on the trains. I’d like a transport system which works. I’d like trains that run on time and a bus to meet my train. I’d like less plastic in the world. I’d like programmes on the TV I wanted to watch. I’d like films with plots and characters and a few less explosions. I’d like banks which didn’t rip you off. I’d like shorter queues in the post office. I’d like less junk mail through my door. I’d like a publicly owned Royal Mail. I’d like more independent shops on my High Street. I’d like the corporations off my back. I’d like lower utility bills. I’d like solar panels on my roof. I’d like the waste water from my bath to water the garden. I’d like newspapers with news in them instead of celebrity gossip and propaganda. I’d like a government I could trust.
But please, oh please, let me open doors by myself.
I had an interesting conversation the other day with the manager who allocates the annual leave. They’ve just brought in a new system. You have to specify the date in one box, and then the day in another box, two boxes for each day, on one half of the sheet; and then do the whole thing again on the second half of the sheet, which they return to you if your request is denied. Meanwhile they allocate dates for you which you haven’t requested, which you then have to ask to be removed: again two boxes for each day, on two halves of the same sheet. The whole sheet is a maze of boxes and dates and days which you have to negotiate your way through. If you fail to fill it in correctly your request will be denied.
In the old days you just asked for the days you wanted and, if certain days were over subscribed, you would have a conversation about it. Sitting in the office with the Line Manager talking about your annual leave was one of the pleasures of the job for both parties.
So I complained about the fact that my last lot of requests hadn’t been given and that I was still being landed with a holiday in February which I didn’t ask for and didn’t want.
The manager was being particularly obstreperous about it. It was obvious that he enjoyed the power he had over me. He said, “we’re not here to please you. This is a business now. It’s the interests of the business that come first.”
The joke here is that neither this manager, nor the management of the Royal Mail as a whole, are businessmen. They are bureaucrats. Very few, if any, of them have ever had any experience outside the Royal Mail. They learnt their trade in a 500 year old state owned industry, not in the cut and thrust of the business world. The basic requirement since privatisation, to cut costs in order to increase profits, is the perfect excuse for them to become even more belligerently awkward than they already were.
War of attrition
Recently there’s been a war of attrition going on in our office. I imagine that it has been repeated in offices up and down the country. We are allowed 40 minutes break in total. We have to take 20 minutes indoors early on in the shift but, according to our national agreement, we are allowed the take the second 20 minutes at the end of the shift, which in the past meant we would go home early. Then management started making people stay in the office for this last 20 minutes which meant that people who had previously had time to pick up their kids from school were no longer able to do so.
How this is in the interests of the business is anyone’s guess.
This is on top of negotiations currently taking place with the CWU over changes to our pension plan, with the union threatening to take a ballot on industrial action if the current defined-benefit pension scheme is closed, as the company proposes, next year.
There are also proposed changes to our working practices, with rumours flying around about what this will mean. There’s talk of a six hour delivery span, of longer and shorter days, of longer hours in the Winter and shorter hours in the Summer, of working in teams and of having our dedicated rounds taken away from us: a whole raft of possible changes which will make the job unrecognisable from what it was.
Most posties took the job because they liked the early hours: but the hours are getting later and later, and the new proposals want to put them back even more.
Most posties took the job because they like working on their own, but new delivery methods sees us working in pairs, and the new proposals want to bring in even larger teams in order to cover sick leave, annual leave and rest days without overtime.
The job is arduous as it is, involving four to four and a half hours of intense activity, walking and carrying weight. A six hour delivery span will be impossible for all but the youngest and most fit members of staff.
And now they want to take our pensions away from us as well.
Is it any wonder that relationships between management and the work force are at an all time low?
As for how all these changes will affect you, the public, I’ll just give one illustration.
In fact, for all the fact that postal work is a menial job, it does involve a high degree of responsibility. We get very close to our customers: intimate even. We know when you are at home and when you are away. We know when marriages are breaking down or when the kids are leaving home. We handle your credit cards and your bank statements. We deliver your birthday and Christmas cards, which can contain cash or gift vouchers. Occasionally thieves will pass through the office, opening your mail in the hope of finding goodies; but they invariably get caught, because customers soon begin to notice their mail is being tampered with, and at the moment it’s easy to locate by whom.
Larger teams will make this increasingly difficult. The lack of a dedicated round will remove the trust from the relationship between posties and their customers. It’s already true on some rounds that you don’t know from day to day who will be walking up your garden path and looking in through your front window: if these changes take place then this will become true of all rounds.
The future is looking increasingly bleak in the postal industry.
If you are in debt, he says, you should use the money to pay down the debt. If you are in credit, you should spend it.
Give money to a rich person and they will hoard it in an offshore account, thus withholding it from the economy.
Give it to an ordinary person, on the other hand, and they would spend at least some of it. They would buy a new three-piece suite, or a new kitchen. They would go on holiday. New clothes for the kids. A new hairdo. They would decorate their house or build a garden shed. They would spend what they felt they could afford.
Spending money creates jobs which gives more people more money to spend. The money goes round and round and the economy grows.
#Positive Money have estimated that of every pound of that £375 billion created by the Bank of England and given to the banks, only 8p went into the real economy.
If, on the other hand, they had given it to us, the people, every pound would have generated £2.80 worth of economic activity and everyone would have been better off.
Isn’t it time we had some new thinking about money?
A letter came through the post this morning. I don’t know who it was from. It was addressed to “Mr Mailman”, with a heart in place of the dot above the i, and a picture of a sleeping cat, with a toy dinosaur on its back.
Here is the picture:
It looks like the cat is dreaming about being a dinosaur and letting out that wild electric roar like forked lightning to frighten away its enemies.
The envelope was green with circles and star shapes, and a big hand drawn star in the middle, which is where my address was written.
The letter itself was written on the inside of the envelope.
At the top it said “stuff + cats = awesome”.
Here is the text of the letter, written, like the envelope, in a simple, unselfconscious, hand, with hearts where all the dots and apostrophes usually go.
It said: “Dear Mr Mailman, my mum says that you always deliver our mail. Even when it rains. Even in the snow.
“I don’t go out in the rain, but I love to play in the snow. I like both. The rain and the snow.
“Anyhow, you will always bring us our mail everyday. You bring me cards from my Grandma on my birthday, and Christmas and you bring us pictures from amerika from my other Nan, even when it will rain.
“My mum says you know my name, she says you know everybody’s name, and that you work hard for us everyday in the rain and in the sun and in the snow. That is amazing.
“Mr Mailman you are amazing. AMAZING!
“LOVE from Evie.R.Body xxxxxxxxxxxxxxxx”
There were 16 kisses and the word “Amazing” appeared both times inside a hand drawn star. The word “everyday” was double underlined.
I can honestly say that was one of the best letters I’ve ever had.
Sometimes my job can be very hard. I often come home from work and just fall asleep, exhausted. That letter made it feel good to be a postman.
So I’d just like to say thank you to Evie.R.Body, whoever you might be. And just as you have written it from everybody, to me, so I think I will dedicate it to all the other postal workers in the world.
So remember this postal workers – or mail men and women, or posties, or whatever you call yourself in your part of the world: You are ALL AMAZING.
I was one of those people purged from the ballot before the election for the leadership of the Labour Party. This is despite the fact that I’m a life-long Labour supporter, have been a member of my Labour Club for over 30 years, and worked closely with the Labour Party candidate in our constituency in the run-up to the last election. I am a member of the Communications Workers Union, and therefore an affiliate member of the Party through my union. I’m an active trade unionist, having been a rep, and have paid the political levy through my union fees for more years than I care to remember.
I was purged, according to the letter I received, because they had “reason to believe” that I “do not support the aims and values of the Labour Party.”
I guess the question then has to be: who defines what the aims and values of the Labour Party actually are?
The Labour Party introduced the new rules, in part, to open up the membership to trade union affiliates, as a way of lessening the influence the trade union bosses had over the party through the block vote. I think that was a good decision, as – theoretically at least – it allowed ordinary trade union members like me a direct say in the running of the party. Until, that is, some of us decided to vote against the mainstream of the parliamentary party: at which point we were summarily removed from the voting list.
This smacks of vote rigging to me and I am currently looking at ways to get redress for what I believe is a blatant political decision. The only reason they can possibly have for rejecting me, is that I have been a vociferous and open supporter of Jeremy Corbyn on social media throughout the campaign.
There are lots of reasons why I wanted to vote for Corbyn. It’s not only that he voiced a clear and uncomplicated message to the party and the world beyond, or that he is a principled and courageous politician – a rare thing these days – it is also that his policies laid out a real alternative to the austerity agenda of both the main parties.
I’m getting on. I walk anywhere from 10 to 13 miles every day, pulling a trolley full of letters and packets, and am generally so exhausted at the end of the day that I can barely stand. My days consist of work, eat, sleep, and very little else. I don’t have enough spare energy to have a social life. The idea that people doing my job will have to work on till they are 68 is a crime against humanity, no less.
This is the reason Jeremy Corbyn spoke to me directly when he talked of lowering the retirement age for manual workers in physically demanding jobs.
A number of my older co-workers have been forced into early retirement as increasing demands are placed upon us. More and more work is being done by an ever shrinking workforce. It’s a young person’s job these days. People are made to cut corners to keep up. They sling their bags over their shoulders and run. When the new working methods were brought in, and bikes were replaced by trolleys, we were told by the union that this was to take the weight off our shoulders. In fact it has put more weight on to our shoulders.
One of the means by which they force us to do more work is something we call “lapsing”.
It’s short for “collapsing”.
In the old days we all had a round each for which we were wholly responsible. There were light days, and there were heavy days. It’s an unpredictable job. On light days we went home early. On heavy days we worked over. But management weren’t happy with this. They wanted to get more work out of us, especially on the light days. This is where lapsing comes in.
They take a round and they collapse it. They divide it into separate roads and they give all of us a number of extra bundles to take out. Sometimes this can amount to a whole bagful of mail and can take up to ¾ of an hour to deliver. They do this with two or three rounds, thus saving man-hours in the office. By lapsing two rounds in an average size office, 48 workers are effectively doing 50 people’s jobs.
They started doing this earlier this year on the lighter days, but as the year progressed they began imposing it every day. They started off collapsing two rounds, but have added a third in the last month, and, while it is true that they cannot force us to work overtime, once out on the round we cannot bring mail back. This means that we have to make our assessments on how much work we can do back in the office, which means a daily argument with the line managers whose job it is to impose discipline on the shop floor.
What is certain is that these new demands are being forced on us by militant shareholders, who want to see better returns on their investment. Shareholders put pressure on upper management, who put pressure on middle and lower management, who put pressure on us.
It’s a recipe for bullying, which is rife throughout the Royal Mail.
We once had pride in our jobs. We were an integral part of the life of the towns in which we worked. When I first started one of the older guys told me he had been on the same round for 25 years. When he retired his customers showered him with cards and gifts. He was like one of the family, a valued member of the community.
Not any more. By breaking up the rounds they break the link between the postal worker and his customers. We don’t have time to stop and chat any more. We just have to keep moving, moving, moving, till our legs ache and our shoulders are numb with the strain.
I overheard one of the managers responsible for organising the rounds talking to one of his minions. He was complaining about the workforce. “One of them has been invited to a wedding,” he was saying. “I don’t want my workers to get to know their customers so well that they go to their weddings, I just want them to get on with their work,” he said.
And in that one single sentence he said almost everything there is to say about what is wrong with the Royal Mail in this post privatisation era.
Christmas arrived for us posties on Wednesday the 4th of December this year. The start of the week had been quiet, with just a trickle of festive mail, but on the Wednesday there was suddenly an avalanche of post falling on top of us: thousands of cards and hundreds of parcels, as well as all the usual advertising, Christmas catalogues and charity begging letters. It’s been like that ever since.
I must admit I don’t deliver all of it. I sort it, bag it up, and deliver some of it. The rest I pass on to one of my colleagues to deal with. For the first time since I started working for the Royal Mail over 10 years ago, I “cut off” on my round: that is I work my hours and refuse to go into overtime.
In fact, if it wasn’t for the influx of temporary staff, or the army of casual workers on rolling contracts, the Christmas mail would never get delivered. It always used to be a matter of pride to me that I would finish the job, no matter how hard it got. Not any more. There are a number of reasons for this. First, they got rid of our bikes and replaced them with trolleys, meaning that mail delivery now involves four hours or more of relentless walking, a much more tiring activity than cycling.
Second, they moved our delivery office to the nearest city, several miles away. I now have a half-hour commute to get to work in the mornings, a half-hour drive to get to my round, another half-hour to get back to the office and yet another half-hour drive home again. I used to cycle into work and then cycle to my round. I was far more inclined to do overtime when it took place 10 minutes from home. It is much less appealing when it means driving home late, tired and in the dark.
Third, all the goodwill I used to have has gone. I no longer feel any loyalty towards the company I work for. Years of being sidelined and ignored, of a failure to consult over the most fundamental aspects of my working life, has left me feeling estranged. I used to love my work. These days it’s “just a job”: something I do because I have to, not because it gives my life any meaning any more.
I’m not the only one who feels this way. Privatisation has merely intensified the mood. Of course, if you were to believe Vince Cable or his advisers, you’d think that without privatisation the Royal Mail would be finished by now. Figures are down, they used to tell us. People are using email and text these days, they don’t need a postal service any more.
Christmas is a reminder that this was always nonsense. People don’t send Christmas texts instead of cards, and no matter how good the technology gets, it will never be possible to send a parcel by email.
Indeed, this is the distinguishing characteristic of this year’s Christmas mail: the sheer number of parcels we have to deliver. I’ve never seen so many. The great skill of our job these days is in keeping a track of them, in knowing how to incorporate them into the rest of the mail.
The very technology they claimed spelled doom for the postal service allows people to go online at any time of the day or night, buying stuff on eBay and Amazon, most of which gets sent through the post. These could be the boom years for the Royal Mail as the margin of profit on parcels is much greater than it is on letters.
Even before privatisation profits were increasing. Pre-tax profits were £233m for the six months to 29 September, up from £94m a year earlier. This was all within the public sphere, so no one can pretend that privatisation had anything to do with it. In other words, everyone knew that there was a bonanza on its way. The real point of privatisation, it seems, has been to allow the private sector to cash in on it.
Something that hasn’t been mentioned much in the post-privatisation analysis is the amount of money the Royal Mail stands to make out of its immense property holdings. One building alone in the company’s portfolio of disused offices in London – the mail centre in Nine Elms Lane – has been valued at half a billion pounds. That’s one-sixth of what the government sold the whole company for.
The office was closed in 2012, more than a year before the sell-off. And it’s not the only one. Dozens of delivery offices up and down the country, including mine, were closed in the run up to privatisation. Several of them remain unsold.
Could the offices have been kept empty on purpose? Royal Mail bosses now stand to make a lot of money out of the company they once used merely to manage.
“A postal duty is, in effect, a four hour intensive workout, and it gets increasingly difficult the older you get. Any further pressure on delivery staff is likely to leave us suicidal.”
According to the Daily Telegraph, “American activist investors” – who are becoming the main buyers into Royal Mail – believe that the company “could execute deeper cost cuts and yield far bigger profits”.
Staff costs are one of the areas being looked at.
“The productivity improvement rate is really pretty low, given the amount of new technology at the company,” said a source. “Now 80% of mail is sorted by technology, yet the productivity costs have only come down marginally in comparison. The company could be far more aggressive on driving the costs savings through.”
We all knew this would happen. The pressure will soon be on to cut staff numbers and to increase workloads in order to improve productivity.
But I can tell you now that this is just not possible, at least where delivery duties are concerned. When Panorama did a programme about the Royal Mail in 2009, it arranged for former Royal Marine and military fitness expert Tony Goddard to test a duty. He was unable to finish it in the allotted time, saying that it was “unreasonable” to expect postal workers to do it five days a week.
A postal duty is, in effect, a four hour intensive workout, and it gets increasingly difficult the older you get. Any further pressure on delivery staff is likely to leave us suicidal.
However, there is some truth in the assessment. The productivity improvement rate is, indeed, pretty low given the amount of technology that has been introduced. There’s a reason for this. It’s called “Methods”.
This is the internal name for the modernisation programme which the company has been undertaking since 2009. It involves the scrapping of bikes and their replacement by trolleys: two postal workers working out of the back of a van using customised golf trolleys, carrying two bags apiece.
The ostensible reason for the new method is so that we can carry more packets: packets being the new growth area within the postal business. However, it is also considerably slower than using a bike. Just to give you a measure of this: my round used to take around three hours and fifteen minutes. Under Methods we are supposed to manage our rounds in four hours. That’s already forty five minutes longer than before. However, there is never a day when we can complete the round even in this time, often going as much as an hour over. In other words, the new method is at least a third slower than the old method.
It is also much more tiring. Using a bike we were constantly changing position: sometimes walking, sometimes scooting, sometimes cycling, sometimes freewheeling down a slope. All we do now is four hours or more of relentless walking, mile after mile: around twelve to fifteen miles a day. My hips and my back ache from the strain and all I can do when I get home these days is to eat my dinner and fall asleep in front of the telly.
Slowing down the work while making it harder: I wonder whose bright idea that was? The reason it’s called “modernisation” and not “a big pile of shit” is that it is being modelled through a computer. We’ve replaced an old technology – bikes – which were very efficient at delivering the mail, with a new technology – computers – which are very efficient at measuring the process. We’ve privileged the needs of the office over the needs of the job. Now you tell me which is more useful in an industry whose sole purpose is the delivery of mail?
It’s a pity they never thought to ask us posties. We would have told them that it wasn’t going to work. TNT – one of the rival mail companies currently experimenting with end-to-end delivery in some parts of London – do so using bikes, while Deutsche Post has recently been testing electric bikes on the streets of Berlin.
The reason the CWU went along with the new method is that it was supposed to take the weight off our shoulders. In fact it has done the opposite: it has put weight onto our shoulders, as in an effort to get the work done on time, many posties are now dispensing with the trolleys.
But the real measure of the insanity of this is that despite the fact that it was extensively trialled, and that it has consistently shown itself to be slower and more costly than the old method, it has nevertheless been rolled out throughout the country.
This is the reason why the productivity improvement rate is so low, despite the amount of new technology being deployed. If “activist investors” really wanted to improve productivity, then they could start by bringing back the bikes. After that, they might consider reducing staff numbers by getting rid of everyone who thought that “Methods” was a good idea in the first place. That includes Moya Greene.
Here’s a summary of the whole advert, in one paragraph:
There’s a Sikh postie walking along a corridor; a little girl placing stamps upon a parcel; a pen drawing hearts in red ink upon a sheet of paper; a man paying for his parcel delivery on-line using a tablet computer; a shot within a parcel depot featuring parcels running on a conveyor belt with lasers reading the addresses; delivery to a café (the café owner opens his arms as if he’s about to embrace the postie) followed by a series of other deliveries in quick succession: to a stately home, to a garage complete with garage-band, to a little girl’s birthday party; a Muslim postie walking passed a training centre with the words “For Hire” painted on the wall; delivery to a factory; a black female postie smiling (the only woman postal worker in the advert); delivery to an upmarket London townhouse; two rain soaked posties; another Royal Mail parcel depot featuring brand new, sparkling-clean Royal Mail lorries; a Royal Mail lorry driving passed a remote rural village; a little girl opening up a letter box in anticipation of a delivery (an intense light bursts from the letter box like a mystical sign); that Sikh postie again, in a massive block of flats (an Indian woman answers the door wearing rubber gloves); another postie dwarfed by another huge, semi-circular block of flats, followed by the slogan, “We deliver one billion parcels a year”; a shot of a postal worker raising his arms in apparent blessing of the contents of a Royal Mail van (he’s like Jesus blessing the loaves and the fishes) ending with the words, “We love parcels.”
Everyone is smiling.
All of that to the words of All You Need Is Love:
Love, love, love
Love, love, love
Love, love, love
There’s nothing you can do that can’t be done
Nothing you can sing that can’t be sung
Nothing you can say but you can learn how to play the game
All you need is love
All you need is love
All you need is love, love
Love is all you need.
And there you have it: the hypocrisy of advanced capitalism in precisely one minute.
The Royal Mail delivers none of that. It doesn’t deliver love. It doesn’t deliver diversity. It doesn’t deliver a welcoming smile. It doesn’t deliver to stately homes, to garages or to birthday parties. It doesn’t deliver hope and anticipation. It doesn’t deliver mail to remote communities. It doesn’t deliver friendliness in the rain. It doesn’t even deliver parcels. We do all of that: the men and women of all backgrounds and ethnicities who work for the Royal Mail. That’s our job.
Now that it is privatised, the Royal Mail’s job is simply to deliver returns to its investors.
For a long time now the Royal Mail has been divided, between management and postal workers, between those who see it as a business, and those who see it as a service. The people who commissioned that advert are the former rather than the latter. It’s not a service to them, it’s a way of making money.
“Granny Smith” is the postal worker’s affectionate nickname for you, the customer. Or rather, for the people that we regard as our customers, the people we meet on the doorstep everyday. But the Royal Mail management doesn’t regard you as their customers. They don’t meet you but once in a lifetime. You are merely the recipients of the mail. Their customers are the people who send the mail in large quantities: the utility companies, the banks, the advertisers, the bulk deliverers, the people who churn letters out by the tonne using advanced computer systems, the mail-shot companies using lists they’ve purchased from other advertisers, the conveyors of junk mail and other unwanted material, the people who fill up your halls and your bins with garbage, the landfill merchants. Those are the Royal Mail’s customers, not you. The people they make the money off.
See: that’s the hypocrisy of that advert. They know that postal workers are held in high regard by the public. They know that most of us will go out of our way to look after our customers, that we will do our best even in adverse circumstances, that we will give that cheery smile in the rain. That was always the case in the past, though it’s getting rarer and rarer as time goes by.
In the old days, we loved our job. It was great getting out and about, on the streets of our towns, delivering the service we knew you wanted. The work was energetic but satisfying. It brought us face to face with our neighbours. And we had a little time to spare back then. There were enough of us doing the job to get the work done and still have enough time left over to lead lives of our own.
Fifteen years ago, the average delivery span was two and a half hours. That’s two and a half hours of high-octane energy expenditure: a workout by any other name. It kept us fit, it kept us happy, it kept the endorphins flowing to our brains. It kept us smiling.
We would get up early to greet the dawn and have the mail on your doorstep by breakfast.
That’s not the case any more.
Ten years ago the delivery spans were increased to three and a half hours.
These days the average delivery span is four to four and a half hours. After two and a half hours of intense work the endorphins cease flowing and the pain starts to kick in. We walk till we ache. We no longer have time for our customers and we’re so dog-tired at the end of the day that we don’t even have time for ourselves. We eat, we sleep, we work, that’s all. There’s no energy left for anything else.
This is called “productivity”. Less posties doing more work, at a faster rate. In the past decade the company has lost 50,000 jobs, with more job losses promised now that it has been privatised.
Less jobs means more work for me. More hours on my feet. More weight in my trolley. More gates, more doorsteps, more letter boxes. More endless miles of trudging drudgery on the streets of my town.
The choice of the X Factor and Downton Abbey to air the advert was very telling.
The X Factor represents the illusion of capitalism, that we may find a way out of its servitude one day: that some of us, at least, through good luck or talent, will be given the keys to escape. Downton Abbey represents the reality: a servant class serving a privileged elite.
As a public service our service was to you, the public. As a privatised monopoly our service will be to the shareholders from now on.
One of my neighbours came over to say hello the day the Royal Mail was privatised.
‘I expect you’re looking forward to getting your hands on all that money you’ve just made,’ he said. The shares allocated to me as a member of staff had gone up by almost 40 per cent in a day. The government had brought forward the date of the IPO in order to beat a strike ballot by the Communication Workers’ Union. Most of us, like most people, were against the privatisation. It felt like my neighbour was congratulating me on taking a bribe.
I lost my temper, and told him what I really thought about the privatisation. I pointed out the contradictions: that the state has spent billions of pounds of public money to subsidise the bargain basement sell-off; that the pension fund was nationalised to sweeten the deal; that the loss-making Post Office was decoupled from its more successful partner and retained in public hands; that pricing restrictions were lifted in anticipation of privatisation, allowing the company to increase its profits.
None of this has got anything to do with the free market. This is direct government intervention to create a rigged market. If the price restrictions had been lifted ten years ago, the entire argument for privatisation would have disappeared overnight.
My neighbour said that governments shouldn’t be involved in the business of running companies. He said that privatisation would allow the company access to future investment. He said that previous privatisations had been a great success, and cited British Telecom and British Airways as examples. He said that taxpayers were fed up with subsidising the Royal Mail.
The argument went on for a while. Every time I was about to get in my car he’d say something that I had to contradict. I finally lost patience and drove away when he talked about the investors who were going to help the company become a big success: ‘They are wealth creators. They build the factories so that we can have jobs.’
You hear that phrase ‘wealth creators’ a lot. It is a commonly used justification for the privatisation agenda, the idea that these individuals generate wealth by their investment. They are the ‘wealth creators’, and we are the beneficiaries of that wealth. It’s a form of magical thinking, like the pharaohs believing that their rituals were responsible for the flooding of the Nile, a post hoc fallacy: because they have invested in the company and increased their wealth, their investment somehow ‘created’ the wealth. The actual wealth creation, the work that my colleagues and I do, in this version of reality, is an accidental by-product of the process, a privilege I am allowed by the goodwill of these magically endowed individuals.
Moya Greene, the chief executive of Royal Mail, has already told us to expect job losses. Very soon I expect to be begging for the privilege of working longer hours for less money.
Vince Cable’s efforts to keep the Royal Mail in the hands of “blue chip investors” and away from “spivs and speculators” was delivered a blow this week when it emerged that the Children’s Investment Fund has taken a 5.8 per cent stake in the company following its privatisation earlier in the month.
The fund was founded by Chris Hohn, described as a “locust” by German politicians, and damned by the former CEO of Deutsche Börse, Werner Seifert, for his part in scuppering a previous business deal.
The London-based hedge fund has bought 58.2m shares or 5.8pc of Royal Mail. Under stock exchange rules, TCI had to declare its stake when it reached 5pc of the company. The threshold was reached on Friday.
Mr Cable has often criticised hedge funds for being short term investors and has repeatedly insisted that Royal Mail would be sold only to “long-term, blue chip” institutional investors.
Meanwhile Chancellor of the Exchequer George Osborne has responded to criticism that the government had sold off the Royal Mail too cheaply.
At a Thomson Reuters Newsmaker event on Tuesday, he told his audience that initial public offers are routinely offered at a discount and the government had followed advice from its bankers on details of the sale.
“On all fronts it has been a great success,” he said.
And in the House of Lords, Labour peer Lord Sugar, star of TVs The Apprentice, questioned the expertise of the banks which had been advising the government on the sale.
He demanded: “Why did these so called experts sell the stock at such low levels and get it totally wrong to such an extent that the stock rose by 33 per cent the day afterwards and since then 54% on the issue price?
“Bearing in mind other reputable banks had come on record giving a valuation of £5 billion, why were these banks ignored and what will you be doing by way of an inquiry in finding out who the lucky institutions were that underwrote this bargain basement sale?”
Government spokesman Lord Popat said the key objective had been to “secure value for money for the taxpayer”.
Pressed by Labour’s Lord Donoughue on the level of fees paid to the banks, Lord Popat said: “The underwriting banks will share a maximum fee of 1.2 per cent of the IPO receipts or £16.9 million. This maximum includes a potential discretionary fee of £4.2 million. The actual fee will be finalised shortly. Lazards will receive £1.5 million as the Government’s independent adviser.”
For those of you without a calculator, it means that three banks, UBS, Lazards and Goldman Sachs, share £18.4 million between them.
Of course, the usual reasoning behind the sale of the company, is that it would allow the Royal Mail access to the financial markets; but, you have to ask, what would have stopped the Royal Mail accessing the markets as a publicly owned company? The answer, it seems, is “very little.”
According to a letter in the Guardian prior to the Royal Mail’s flotation it “is purely the Treasury’s insistence on keeping to the UK’s unique borrowing rules, which are not followed by any other country.” The government-owned French energy company EDF, and the German transport company Arriva, have no such limitations, and operate freely in the UK. The Royal Mail was already classified by the Office of National Statistics as a public corporation and could have enjoyed the same freedoms as state-owned companies elsewhere in Europe. All that was needed was for the Treasury to adopt the same rules as other countries have had for decades.
The writer, John Perry, adds: “It continually surprises me that opponents of Royal Mail privatisation have not pursued this argument, especially as it addresses one of the government’s main arguments in favour of selling it off. Given that the government have already made a similar rule change in favour of the publicly rescued banks, there is a clear precedent for such a change in favour of Royal Mail.” This would have rendered privatisation unnecessary, he says.
In other words, it’s one law for the banks, and another for the Royal Mail.
The price of Royal Mail shares has increased by almost 50%, from 330p to over 500p.
Thousands of investors have made huge profits just days after their initial investment.
Almost 700,000 small investors purchased £750 worth of shares and have witnessed an instantaneous increase in their value.
The government are under scrutiny for having undervalued the price of the Royal Mail.
It is the taxpayer who is set to pay the price for the government’s mistake as investors, large and small, are set to continue to benefit.
In the past few days the Royal Mail’s market value has soared to over £5 billion representing a £1.7 billion increase.
Chuka Umunna, Labour’s shadow business secretary, said: “Royal Mail is being sold off on the cheap with taxpayers being short-changed to the tune of hundreds of millions of pounds. Yet out of touch ministers have ploughed on regardless and claimed this is a ‘triumph’. Increasingly this privatisation is looking like a botched job from an out-of-touch government that puts the wrong people first.”
The Secretary of State for Business Vince Cable has responded by branding the share price increase as “froth” and has encouraged people to focus on the long term implications of the sale.
However, Stockbrokers Peel Hunt responded by saying: “This is not ‘froth’; it’s real people buying, selling, averaging down.”
It is thought over 100 million shares were purchased in the first hour of trading and an estimated 700,000 people were given 227 shares worth £750.
The unusually high demand has lead some commentators to question why so many people are investing in them and whether the government did in fact completely undervalue the business.
Cable has asked people to think about the long term future of the Royal Mail, and has indicated that he has attempted to keep the company in the right hands.
Almost 40,000 people who tried to acquire more than £10,000 worth of shares were denied any form of sale.
It is also thought that government denied a number of city investors and hedge funds in a bid to keep the business out of their hands, although 70% of the shares did, in fact, go to large investors.
Cable said that demand across the country was so large that the government was able to stop shares being sold to “spivs and speculators” and instead could focus on sales to “responsible long-term institutional investors”.
Meanwhile, the National Audit Office will launch an inquiry into the allegations that the business was undervalued.
A vicar of three Hampshire villages fears the privatisation of Royal Mail will hurt rural communities.
The Reverend John Owen is vicar of the villages of Froxfield, Steep and Privett, near Petersfield.
He praised his local postman, John Luker, who has collected and delivered letters in the villages between Petersfield and Alton for 32 years.
“John knows the local roads like the back of his hand. He doesn’t use a SatNav, never gets lost, and knows a good many of the 800 inhabitants of Froxfield and Privett by name,” said Mr Owen.
“If something is amiss, John is likely to notice it on his delivery round and will raise the alarm.
“We wonder how economically viable his job will be when the flotation of the Royal Mail takes place.”
Mr Owen said villagers were sceptical about official assurances of a continued daily collection and delivery in the hamlets. Most predict a weekly collection, which will mean villagers have to drive to larger towns nearby to post urgent items.
“John Luker represents that bit of community capital and cohesion which does so much for the well-being of the rural community,” said Mr Owen.
“He’s not unlike the landlord of the local pub and the people who have been running the village shop for years. They help to bind the community together.”
The vicar said rural communities would be poorer, emptier and less attractive as a place to live without the postal service.
“As Christians, we are aware that life can’t be quantified in a balance sheet,” he said.
“Our church members will be challenging this thinking and finding new ways to serve their rural communities – churches hosting post offices is just one way they are already helping.
“But my plea would be for us to hold back from privatisation of the Royal Mail until these issues have been thought through properly.”
Mr Luker added: “I have 283 calls to do, and drive about 36 miles a day from our office in Petersfield. I know any private firm wouldn’t have the same kind of local knowledge that I have. I love these villages and I know about 90 per cent of the people who live here, by sight or by their Christian names. It will be hard to replace that.”
David Cameron calls it ‘popular capitalism‘. He is referring to the fact that the flotation of the Royal Mail was oversubscribed many times. On the back of this he is planning even more sell-offs. But how many people could actually afford the £750 required to buy the minimum amount of shares in the company? Very few, I would think. Only the well off have that sort of money to spare these days.
As for us employees, well we had the right to buy shares at a reduced rate, as well as the shares that we were given. I don’t know about you, but I don’t have any spare money either, and I can’t imagine that many employees would have taken up the offer. Except on the highest level of management, that is, where, once again, certain people, including chief executive Moya Greene, have done extremely well.
Eleven directors have between them more than 35,000 shares in the firm. Those shares started off being worth around £115,500 but are now worth more than £168,000.
Moya Greene has 3,643 shares in the company. They started off being worth just over £12,000 but were worth £17,300 within less than a week.
Ms Greene’s basic salary is £498,000, but other benefits mean her total package is around £1.1m.
Meanwhile Peter Davies, a member of management committee for Lansdowne Partners, and a close friend of George Osborne, saw the value of his company’s shares rise by £18 million after just one day’s trading.
In fact 67% of the British public were against the privatisation. Only 4% were ’strongly’ in favor. 96% of Royal Mail employees were against the sale.
In other words, what Cameron really means when he refers to the popularity of the sale is that it is popular with investors and with higher management. With his friends, in other words. They’re obviously the only ones that Cameron thinks are important.