Mark Leftly: How battling Binley put his stamp on the Royal Mail sell-off inquisition
Westminster Outlook: Mr Binley has absolutely thundered at what passes for the financial logic of the Royal Mail flotation
Mark Leftly is political correspondent at The Independent on Sunday and associate business editor across the Independent titles. He writes a weekly column, Parliamentary Business, published on a Wednesday, that covers politics and the City. He is a multi-award winning reporter and was named Press Gazette's business magazine journalist of the year prior to joining The Independent on Sunday.
Friday 02 May 2014
According to the script, Adrian Bailey and Margaret Hodge played the leading roles for the parliamentary inquisition into the farce that is the privatisation of the Royal Mail. As chairmen of the business and public accounts committees respectively, they were jostling for the spotlight as they interrogated ministers and advisers this week over why Royal Mail was undervalued by around £1bn when it floated on the stock exchange last year.
But, as Mark Hamill’s Luke Skywalker was upstaged by Harrison Ford’s Han Solo in Star Wars (and surely will be again in the next trilogy of the sci-fi saga), this leading man and lady saw some scene-stealing performances from their supporting cast of committee members.
The real focus here is Mr Bailey’s business committee. Few could ever truly upstage Mrs Hodge, who again chewed up the oak-panelled scenery as she accused Royal Mail’s bankers of operating “like an institutional masonic lodge”.
These committees are essentially fighting over which can damn Royal Mail’s flotation more loudly, more quickly. Mrs Hodge, though, has only just started her inquiry – Mr Bailey’s bunch started in October, shortly after Royal Mail debuted on the markets with shares at what has turned out to be a low-ball 330p a pop.
William Rucker, the Lazard chief executive who advised the Government on the share sale, was surely exasperated at having to face both committees this week. I overheard the business minister Michael Fallon say to him after Tuesday’s hearing: “So, you’re appearing again tomorrow? Today was just batting practice for you.”
This slightly unedifying competition between the two committees has at least resulted in an unparalleled level of scrutiny of the privatisation. That in itself forced the business secretary, Vince Cable, finally to disclose the hitherto carefully concealed list of 16 hedge funds, sovereign wealth funds and other investors that were allowed to buy, and immediately profit from, a 22 per cent stake in Royal Mail at the off.
The renewed focus on Royal Mail also gave Labour’s former shadow Scottish secretary Ann McKechin and the tough-talking septuagenarian Tory Brian Binley their chance to shine again, and this time to a far wider audience, at least from the media.
Their styles differed greatly – Ms McKechin forensic, Mr Binley balls-busting – but both showed how these committees are becoming increasingly effective at getting under the skin of British business.
Resplendent in red, Ms McKechin carefully unpicked the argument that Royal Mail’s shares had to be priced low to encourage investors to buy them. So concerned were they of the threat of strike action as the result of an ongoing pay and conditions dispute, there was no way they would have paid much more than 330p a share, or so the government argument goes. The Glasgow North MP demanded that Mr Cable tell her how many days of work had been lost to industrial unrest at Royal Mail over the previous two years.
“I suspect relatively few,” came the tame admission.
“So, you had a company that had an increasing profit and a reasonable degree of industrial relations, and you thought there was going to be a car crash on the price,” Ms McKechin concluded.
Mr Cable said strikes were “plausible”.
Only one winner in that exchange, and it wasn’t the bloke off Strictly Come Dancing.
But if there were a supporting MP awards, there would only be one winner at the moment, and that is Mr Binley, who has represented the good people of Northampton South since 2005 but retires next year. “Brian’s a bit demob happy,” laughs Ms McKechin. “But he’s not afraid of criticising his own [Conservative and Coalition] colleagues when he thinks it’s the right thing to do.”
A lifelong businessman, who founded publishing and marketing businesses in Northamptonshire that still employ some 300 people, Mr Binley has absolutely thundered at what passes for the financial logic of the Royal Mail flotation. Back in November, he told Richard Cormack, the senior Goldman Sachs banker on the deal: “I was in the business of selling beer years and years ago. Anybody can sell cheap beer.” This week he ordered one witness to stop glaring at him, and told Lazard’s Mr Rucker: “I do not understand why you were being so obstinate about saying, ‘We got it right,’ when you palpably got it wrong.”
This was just one of his many ferocious verbal assaults, but Royal Mail is a personal issue for him. Mr Binley says he spent years trying to save sub-Post Offices when he realised that in isolated towns they were about more than parcels and letters, they were places where people met and gossiped – “part of the social weekly programme”.
By dint of age and independence Mr Binley was never destined for ministerial office. But Parliament needs more MPs like him.
Fortunately, the survivor of non-Hodgkin’s lymphoma has some sage parting advice for the institution he leaves behind: “Maybe we ought to have people serving less time here, regularly reinvigorate the place. There are too many people who went from university to MP’s researcher to special adviser to junior member of Parliament – they don’t have that understanding of the bottom line.”
In other words: get a real job first.
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