Cable accused of 'talking down' Royal Mail

 

Labour’s Chuka Umunna launched an attack on Vince Cable last night, claiming the Business Secretary was deliberately “talking down” the value of Royal Mail in order to defend himself against the damning report by MPs  on the “botched” privatisation of the company.

Having been accused by a Business Select Committee of overseeing a process that left taxpayers shortchanged by £1bn on the Royal Mail sale, Mr Cable spent yesterday claiming that the risks to the organisation’s finances posed by encroaching competition and the declining postal market meant it was not a strong prospect for investors.

Mr Cable was also stressing that at the time the Government’s advisers were marketing the float, there was the prospect of possible in- dustrial action that could have dented the company’s profits even further.

The Chancellor, George Osborne, was also sending out similar messages in interviews yesterday.

However, Mr Umunna told The Independent: “They are proclaiming the privatisation was a success – well I’d hate to see what failure looks like.

“But, as if that weren’t bad enough, the response of Vince Cable and the Department of Business has been to talk down the company.

“I think that’s outrageous at a time when the taxpayer still owns 30 per cent of the company.”

He added that Royal Mail’s future was nowhere near as threatened as the Government was claiming, with its industrial relations issues resolved, increasing profits and the modernisation programme having been implemented successfully.

Royal Mail, however, has been lobbying regulators hard to make it tougher for new entrants to compete with it on the more profitable delivery routes. The company fears that it will be unable to fight off rivals in lucrative town centres yet still be left having to deliver to the far-flung rural destinations as demanded by its pledge to continue offering a universal postage service from Land’s End to John O’Groats.

 Shares in Royal Mail were sold to investors at 330p and shot up 38 per cent on their first day of trading amid frenzied demand. Big investors continued buying even as the shares carried on rocketing, until they peaked at 615p in January.

They have since dipped back and stood at 476p at last night’s close.

PROMOTED VIDEO
Arts and Entertainment
musicBand's first new record for 20 years has some tough acts to follow
News
peopleAt least it's for a worthwhile cause
Voices
A new app has been launched that enables people to have a cuddle from a stranger
voicesMaybe the new app will make it more normal to reach out to strangers
News
Liam Payne has attacked the media for reporting his tweet of support to Willie Robertson and the subsequent backlash from fans
peopleBut One Direction star insists he is not homophobic
Life and Style
healthFor Pure-O OCD sufferers this is a reality they live in
Life and Style
Sexual health charities have campaigned for the kits to be regulated
healthAmerican woman who did tells parents there is 'nothing to be afraid of'
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trainee / Experienced Recruitment Consultants

£20000 - £25000 per annum + OTE £40,000: SThree: SThree are a global FTSE 250 ...

Trainee Recruitment Consultant - Soho

£20000 - £25000 per annum + OTE £40000: SThree: As a Recruitment Consultant, y...

Trainee Recruitment Consultants - Banking & Finance

£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...

Quantitative Risk Manager

Up to £80000: Saxton Leigh: My client, a large commodities broker, is looking ...

Day In a Page

A roller-coaster tale from the 'voice of a generation'

Not That Kind of Girl:

A roller-coaster tale from 'voice of a generation' Lena Dunham
London is not bedlam or a cradle of vice. In fact it, as much as anywhere, deserves independence

London is not bedlam or a cradle of vice

In fact it, as much as anywhere, deserves independence
Vivienne Westwood 'didn’t want' relationship with Malcolm McLaren

Vivienne Westwood 'didn’t want' relationship with McLaren

Designer 'felt pressured' into going out with Sex Pistols manager
Jourdan Dunn: Model mother

Model mother

Jordan Dunn became one of the best-paid models in the world
Apple still coolest brand – despite U2 PR disaster

Apple still the coolest brand

Despite PR disaster of free U2 album
Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments