Union Members Protest Against Post Office Part-Privatisation

Hundreds of postal workers are staging a protest against Government plans to sell off 30% of Royal Mail.

Members of the Communication Workers Union (CWU) from across the country have gathered at Westminster before they will lobby MPs as part of a campaign against part-privatisation.

Ministers have argued Royal Mail could not survive without the sale. However, 125 Labour MPs oppose the plans, arguing the party made an election pledge to keep the company in public hands.

The Prime Minister's spokesman said the Government wanted to "secure the future" of Royal Mail.

He added: "We maintain our commitment to a publicly-owned Royal Mail providing customers with an excellent service."

A letter, written by Jane Newell - chairman of the Royal Mail's pension trustees - to Business Secretary Lord Mandelson, claimed there would be dire consequences if the plans failed.

The letter added that the pension fund deficit would be "significantly larger" than the previously predicted figure of £5.9 billion if recommendations from last year's Hooper report into the business was not implemented.

But the CWU have criticised the letter as being deliberately leaked, in an attempt to "scare" those against the privatisation.

Its leader Billy Hayes said it was a "scandal" that the chairman of the pension trustees was "interfering" in politics.

He told Sky News: "The government is saying they want a foreign company to run the post office, which is ridiculous. We could be faced with a situation where the Royal Bank of Scotland is nationalised and the Royal Mail is privatised."

Among the many Labour MPs signing the motion was Peter Hain, the former Work and Pensions Secretary, who said that the "colossal" pensions deficit was far from the only issue.

"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.

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 needed - such as automating services.

"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.

Dutch postal group TNT has said it was keen to buy a stake in the Royal Mail, with other foreign firms from Denmark and Sweden reportedly expressing an interest.

(JM/BMcC)