View from City Road: Mint would make a sensible sell-off

For obvious reasons Llantrisant in Mid Glamorgan, home to the Royal Mint for the past 25 years, is sometimes unkindly referred to as the hole with the mint in the middle. Some of its residents were hoping it might also become the site for privatisation of our coinage. Sadly not. Kenneth Clarke, the Chancellor, announced yesterday that the mint would continue as an executive agency.

Privatisation was never official policy, though it was at one time a serious option said to be favoured by Michael Portillo, the right-wing Chief Secretary.

The Chancellor did not explain why he had dropped the idea, but Mr Clarke would have had more than the voters' fury to worry about. What the Queen would have said about selling an organisation that stamps her head on billions of coins - to designs she personally approves - is an interesting matter for speculation. Rumour has it she is not too keen on privatising Royal Mail either.

The sad thing about the Chancellor's decision is that privatising the Royal Mint is a much more sensible idea than some of the other zany sell- offs with which the Government is trying to shoot itself in the foot, including Royal Mail and the railways.

The mint is a self-contained and profitable manufacturing business, the world's leading exporter of coins, with more than 50 per cent of the international market. According to the annual report, published yesterday, the mint last year made a record operating profit 38 per cent higher than the year before. The Treasury was kept sweet with a dividend higher than its profits. (Memo to Stephen Dorrell, Financial Secretary: if this isn't an excessive dividend, what is?).

As a proposition for investors, a 23.2 per cent average annual rate of return over the past three years - compared with a target of 12.5 per cent - would be tempting. This is a world- beating business that has no place in state ownership.