MPs urge more freedom for Post Office

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THE ALL-PARTY Trade and Industry Committee is expected today to call for greater commercial freedom for the Post Office but will fall short of recommending that it is privatised. It is also likely to urge ministers to publish without delay their own review, begun more than 18 months ago, of the future of the Post Office.

The committee's report comes amid rumours of a Cabinet split. Michael Heseltine, the President of the Board of Trade, has said that the way forward is in the private sector.

But he is believed to have met opposition from a number of senior colleagues who feel that attempts to privatise the Post Office would lead to a back bench rebellion. This is despite assurances from Mr Heseltine that the letter post would be maintained throughout the country at prices that were both uniform and reasonable.

Because of the political concerns it is thought that the Mr Heseltine might opt for a partial sale, keeping Post Office Counters in the public sector and privatising the parcels business and Royal Mail. Those two businesses could raise up to pounds 2bn.

Bill Cockburn, chief executive of the Post Office, said he would back moves to split the company if it gave him the commercial freedom he wanted. Until now he has said that the organisation should be kept as a whole.

The Post Office claims that the delay in the Government's decision is damaging its competitive position at home and overseas.