Royal Mail sell-off plans shelved
Digg
del.icio.us
Facebook
Reddit
Google
Stumble Upon
Fark
Newsvine
YahooBuzz
Bebo
Twitter
Independent Minds
Gordon Brown suffered a wounding double blow to his authority yesterday as he abandoned moves to sell a stake in Royal Mail and was defeated by Labour rebels over plans to clean up the Commons after the expenses scandal.
The fresh setbacks came after he endured bruising clashes with David Cameron over spending plans and faced ridicule from Tory MPs after he spoke of a "zero per cent rise" in budgets.
The retreat over part-privatisation of Royal Mail was blamed by Lord Mandelson, the Business Secretary, on the struggle to attract buyers in the recession. But the opposition parties claimed the climbdown had been forced by the growing opposition to the sale among Labour MPs and trade unions.
It came a day after Alan Johnson, the new Home Secretary, watered down the Government's plans for identity cards and a fortnight after Mr Brown performed a U-turn over holding the Iraq war inquiry in public.
Had ministers pressed ahead with the Royal Mail part-privatisation, which was opposed by more than 140 Labour backbenchers, they would have been forced to rely on Tory support to get the measure through the Commons.
The announcement was a personal embarrassment for Lord Mandelson, who had argued the sale was essential to revive the fortunes of the troubled business and tackle its crippling pension scheme deficit. Although he had repeatedly warned that the issue could not be ducked, he finally scrapped attempts to sell the stake in a brief statement to peers.
He said: "We have thoroughly tested the market to see who is interested in partnership but economic circumstances, I need hardly point out, are extremely difficult. I have always been clear we would only do a deal with the private sector if it represented value for money for the taxpayer."
Lord Mandelson insisted he would revive the sale when market conditions improved.
Only one potential buyer, the private equity group CVC Partners, had made a formal bid for the Royal Mail stake. It is thought to have offered about £1.9bn for a 30 per cent share in the business.
Two hours after the announcement, the Government suffered a surprise defeat to the Parliamentary Standards Bill, which had been rapidly drawn up in an effort to rebuild the reputation of the Commons.
By a majority of three, MPs defeated a clause that would have allowed parliamentary debates to be used in court as evidence. Malcolm Jack, the Commons clerk, had warned that the move would have had a "chilling effect" on MPs' freedom of speech.
View all comments that have been posted about this article.
Offensive or abusive comments will be removed and your IP logged and may be used to prevent further submission. In submitting a comment to the site, you agree to be bound by the Independent Minds Terms of Service.
- Print Article
- Email Article
-
Click here for copyright permissions
Copyright 2009 Independent News and Media Limited
Comments
And does anyone think Mandelson's efforts with the car industry will yield a great result? If you doubt it, look over his political scorecard - nothing on the credit side, however you look at it.
To put it politely, "all announcement, but no outcome".
The guy's a political charlatan who tries to charm (shudder!) the gullible with a faux sophistication. Unfortunately, when you open the packet there're no contents, just a piece of paper informing you what should have been there.
However, whilst he has been the political glue just barely holding Brown's miserable regime together, he is also coming apart personally - his confidence is shot and he's becoming even more unbelievable - as he realizes that the Labour edifice cannot be saved.
As before, with his previous indiscretions, a disaster looms large and close - he will be caught out and will have to shuffle off the stage for a final time.
Toolan
Our current problem is that to some even the slightest hint of state intervention let alone ownership lead to accusations of Stalin-ism, Trotskyism, Communism or whatever they like to sling. On the other hand we have neocon free market capitalists whose ideology believes everything can be marketised and that it will automatically adjust to give the general good. The fact is that history has told us both positions have and will let us down. Markets should be free but regulated to protect the people as a whole. The models were built on assumptions of full and perfect knowledge by participants and this is blatantly not true. Even if knowledge is available there is too much to absorb. Also the public interest represented by shred, public and collective goods may mean that the market can produce less than optimal results.
Money supply and management, energy, natural resources and transport/communications infrastructures need tighter regulation, sometime subsides and even state ownership to deliver optimum economic and social benefits. The mistake is to think that all things should be controlled by the state or to think the state has no part. The important thing is to ensure that the democratic institutions and processes work well and that the state is properly held to account and operates in a transparent way.
The Post Office should be government owned and controlled but needs radical rethinking for /collection platform for government information and the money supplies associated with benefit systems. Too many people concentrate the letter side and point to email, etc, as indicating that's demise. The Post Office needs to understand when a physical delivery is necessary and optimises around that. I suspect that needs MORE outlets (Post Offices) and less postmen on rounds. The unions need to come to terms with that.
Our current problem is that to some even the slightest hint of state intervention let alone ownership lead to accusations of Stalin-ism, Trotskyism, Communism or whatever they like to sling. On the other hand we have neocon free market capitalists whose ideology believes everything can be marketised and that it will automatically adjust to give the general good. The fact is that history has told us both positions have and will let us down. Markets should be free but regulated to protect the people as a whole. The models were built on assumptions of full and perfect knowledge by participants and this is blatantly not true. Even if knowledge is available there is too much to absorb. Also the public interest represented by shared, public and collective goods may mean that the market can produce less than optimal results.
Money supply and management, energy, natural resources and transport/communications infrastructures need tighter regulation, sometime subsidies and even state ownership to deliver optimum economic and social benefits. The mistake is to think that all things should be controlled by the state or to think the state has no part. The important thing is to ensure that the democratic institutions and processes work well and that the state is properly held to account and operates in a transparent way.
The Post Office should be government owned and controlled but needs radical rethinking for distribution/collection platform for government information and the money supplies associated with benefit systems. Too many people concentrate the letter side and point to email, etc, as indicating that's demise. The Post Office needs to understand when a physical delivery is necessary and optimises around that. I suspect that needs MORE outlets (Post Offices) and less postmen on rounds. The unions, and all of us, need to come to terms with that.
Pressure On Govt To Take Over Mail Pensions
The Government is under pressure to explain how it will cope with the Royal Mail's £10bn pension fund deficit after it abandoned plans to sell off part of the service.
I thank you
Firozali A.Mulla
I thank you
Firozali A.Mulla