Part of the Post Office may be put up for sale

The outcome of the Government's review into the Post Office is set to emerge soon amid indications that ministers will sanction a public- private partnership as the answer to its calls for commercial freedom. Michael Harrison reports.

Michael Heron, the Post Office chairman, and his chief executive, John Roberts, have been called to a meeting with the Industry Minister, Ian McCartney, in two weeks' time to be told how the Government intends to free the organisation up.

The Government appears to have ruled out a sale of a majority stake in the Post Office. But the prospect of a partial sale, allowing the private sector to take a stake of up to 49 per cent in the business, looks possible.

Mr Heron said yesterday that the ownership of the Post Office was a matter for the Government but he would not object to a solution that left 51 per cent in public hands and allowed the remainder to be sold. An announcement about exactly what form of commercial freedom it will be allowed and the degree of private funding is expected around Christmas.

The priority for the Post Office is to be released from the constraints of the Public Sector Borrowing Requirement, which prevent it from borrowing on the open market to develop commercial ventures.

Mr Roberts said that unless it was removed from the stranglehold of the PSBR then any other changes to the Post Office would amount to little more than "cosmetics around the edges".

The Post Office's contribution to the Exchequer last year reached pounds 500m, including taxes and the "dividend" it pays from profits through the PSBR. Mr Heron said that using the Post Office as a cash cow was no basis on which to run a commercial competitive business.

Commercial freedom would allow the Post Office to set up joint ventures with private operators and even take them over - the privatised Dutch Post Office bought TNT earlier this year.

Meanwhile the Post Office has warned that many businesses, including its own, may not be able to cope with the millennium timebomb and a switch to a single currency at the same time.

Mr Roberts said the Post Office was spending pounds 60m to get its computers ready for the date change in 2000. If it had to prepare for EMU at the same time, a changeover that would require huge retraining of counters staff, then it might be overwhelmed.

News
peopleFrankie Boyle responds to referendum result in characteristically offensive style
Arts and Entertainment
Highs and lows of the cast's careers since 2004
News
news
New Articles
i100... with this review
PROMOTED VIDEO
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

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Day In a Page

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
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam