Insisting that Post Office privatisation was against the public interest, Mrs Beckett indicated that a sell-off or partial share sale had never been on Labour's agenda. Her comments were being interpreted in Westminster as an attempt to assert her control over the trade and industry brief from any moves by the Treasury to use the Post Office to raise much needed cash. A partial flotation of half the Post Office could raise pounds 2bn.
"This story has emerged two or three times now. I've never been able to understand who is putting it about. It didn't have validity then and it does not have validity now," Mrs Beckett said. Senior Labour sources went even further last night, describing the idea as the "wildest fantasy" and adding that no proposal had been put to the DTI by the organisation. "We certainly aren't considering it and we never have been."
Post Office executives are understood to have drawn up several privatisation options in the months before the election and held exploratory discussions with Labour figures.
The Post Office is one of the few remaining state assets with the potential to raise billions from a share sale.
Two strategies are thought to have been highlighted. One would be to sell 49 per cent of the Post Office, retaining the controlling stake in government hands.
At the same time it would gain the operating freedom to raise money on the financial markets independently of the Treasury and buy other businesses or enter into joint ventures. The other option is to sell at least 51 per cent, with the state hanging on to a "golden share".
Mrs Beckett's tough stance will come as no surprise given her reputation in industry circles as being instinctively opposed to selling off state assets. Gordon Brown, the Chancellor, is committed to making an inventory of national assets to examine if any were no longer needed.
Another signal apparently came with the appointment of Ian McCartney, seen as linked to the "old Labour" agenda, as the minister with direct responsibility for the Post Office. He replaced Kim Howells, a well-known advocate of greater commercialisation, who went to the Department of Education and Employment.
The Post Office put a brave face on the comments, insisting that no privatisation plan was about to be submitted to the Department of Trade and Industry. A spokeswoman added: "There is no plan. It's just absolute speculation."
Though Mrs Beckett's comments will disappoint the Post Office, senior executives will be heartened by her backing for greater commercial freedom, a move the Conservatives consistently failed to deliver. Mrs Beckett explained: "We are very keen to explore with the Post Office the potential for commercial freedom. It would certainly be a very good idea."
She added that at this stage no firm options were being discussed yet, though meetings with the Post Office are likely to be held within weeks.
A possible blueprint would be to turn the Post Office into a 100 per cent-government-owned company, free from Treasury spending limits. The Post Office is due to contribute pounds 330m this year to government coffers through the external finance limit. Managers have attacked the scale of the payments many times. They argue that it depletes much needed investment capital.
This would allow the Post Office to compete more effectively with private carriers such as TNT and Federal Express.Reuse content