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18/05/2006
Royal Mail receives £1.75bn government funding
The Royal Mail has received a £1.75 billion package from the government in order to help plug the deficit in the pension fund and pay for modernisation.
The government confirmed that £900 million would be made available in the form of a loan with commercial rates of interest, while the remaining £850 million would come from existing Royal Mail reserves
Trade and Industry Secretary Alistair Darling said: "This financing framework will give Royal Mail the right basis from which to take forward an ambitious modernisation programme, helping to deliver a world class service.
"Giving Royal Mail the freedom to use its financial resources to invest for the future puts the company in a stronger position to successfully compete in the marketplace and also deliver a financial return for the taxpayer."
The move has been welcomed by the Communication Workers Union.
The Royal Mail has seen profits rise by 17% to £355 million over the past year. The results meant that staff received bonuses of more than £400 per person.
(KMcA/GB)
The government confirmed that £900 million would be made available in the form of a loan with commercial rates of interest, while the remaining £850 million would come from existing Royal Mail reserves
Trade and Industry Secretary Alistair Darling said: "This financing framework will give Royal Mail the right basis from which to take forward an ambitious modernisation programme, helping to deliver a world class service.
"Giving Royal Mail the freedom to use its financial resources to invest for the future puts the company in a stronger position to successfully compete in the marketplace and also deliver a financial return for the taxpayer."
The move has been welcomed by the Communication Workers Union.
The Royal Mail has seen profits rise by 17% to £355 million over the past year. The results meant that staff received bonuses of more than £400 per person.
(KMcA/GB)
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