Parliament: Postal Restructure - Byers denies hidden agenda for Post Office

THE GOVERNMENT was accused of having a hidden agenda to privatise the Post Office by stealth, as Stephen Byers, Secretary of State for Trade and Industry, outlined plans yesterday to convert it into a publicly owned company.

He said sufficient safeguards had been given to prevent a sell-off, insisting the Government would not be able to dispose of any Post Office shares without introducing further primary legislation. Under his proposals, as outlined in the White Paper on the Post Office, the business will be given more commercial freedom and turned into a plc.

But Mr Byers admitted that it could enter into a joint venture or strategic alliance with another company and sell some shares without separate legislation being needed.

While MPs would still get the chance to debate and vote on such move, it would be passed through Parliament as the equivalent of secondary legislation.

Mr Byers also said the requirement to deliver to all addresses would be laid down in law for the first time. He said in a Commons statement: "This will guarantee the uniform tariff for these services. The cost of a stamp will be the same, regardless of the distance of delivery." The aim of the reform was to transform the Post Office into "a world-class service for the 21st century".

Mr Byers confirmed that the monopoly on post over pounds 1 would end and be cut instead to 50p or 150g from April next year. "It is good news for the Post Office's millions of customers, who will benefit from improved services from a new, modernised Post Office and from greater competition for postal services."

A new independent postal services regulator would promote consumer interests, regulate prices and ensure a high level of service. Consumers' views would also be championed by a "greatly strengthened" Post Office Users National Council and all 19,000 post offices would be equipped with a computer system.

Mr Byers added: "There have been suggestions from some quarters that this is part of a plan to privatise the Post Office by stealth. There are no such plans. As we said in our manifesto, we intend to provide commercial freedom while retaining the Post Office in public ownership."

The Government's financial demands on the Post Office would be cut to match commercial dividend rates, he said.

For this year it would be reduced to 50 per cent of post-tax profits and next year to 40 per cent of post-tax profits.

Angela Browning, opposition trade and industry spokeswoman, dismissed the White Paper as a "mucky compromise" between New and Old Labour and predicted that in the 21st century the Post Office would be fully privatised.

Peter Mandelson, who unveiled a blueprint for reform in December when he was secretary of state for trade and industry, welcomed the plans, warning: "The Post Office is in great danger now of slipping behind very, very tough international competition indeed."