A union campaign to oppose controversial government plans to privatiseRoyal Mail won the backing of the TUC today, setting the coalition on a collision course with millions of workers. On the closing day of the TUC conference in Manchester, unions unanimously backed an emergency motion from the Communication Workers' Union warning that hundreds of post offices would close and the universal postal service end if the business is sold off. The CWU will be targeting 71 key marginal parliamentary seats held by Conservative and Liberal Democrat MPs as part of its campaign after the business secretary, Vince Cable, appeared to confirm last week that there could be a total privatisation of Royal Mail – a move which goes further than previous Liberal Democrat and coalition promises.
The CWU's deputy general secretary, Dave Ward, told delegates that putting Royal Mail into private hands would be a "disaster" for the service. "Royal Mail has a fully funded, successful modernisation programme and the stability of a three-year agreement with the union and workforce," he said. "Privatisation would be a disaster for the Royal Mail so backing from the TUC is important to strengthen opposition to this unpopular policy." The CWU fought off Labour's ill-fated attempts at a partial privatisation when it was in power, which were dropped last year by Cable's predecessor, Lord Mandelson, who blamed the lack of credible bidders for the proposed 30% stake.
Ward rounded on the previous Labour government for the "disastrous" way it had introduced competition into the postal industry, which he said had allowed competitors to take 60% of Royal Mail's profitable business. He said the threat of competition and Royal Mail's £8bn pensions deficit could be tackled without privatisation. He also claimed that the government is planning to take the £25bn of assets in Royal Mail's pension fund to deal with the deficit. "We have not gone through the painful barrier of modernisation to suddenly hand it over to private investors who will reap the benefits and attack our members' jobs," said Ward.
The universal service, under which letters are delivered anywhere in the UK for the same price, would end if the Royal Mail were broken up, he warned. Cable revealed last week plans for a bill to enable the sell-off of Royal Mail – which will include offering shares to employees – on the day the coalition government also published an updated report by civil servant Richard Hooper on the postal services sector, which argues for the privatisation and break-up of Royal Mail. The CWU said the Hooper report had been "politically motivated" to give the government the green light to sell off the service.
The coalition agreement initially promised only that the government would be seeking "an injection of private capital" into Royal Mail. The Lib Dem manifesto proposed that 49% of Royal Mail be sold off with the rest divided between employees and the state. Cable admitted: "We are going further than that, recognising the urgent need for new capital."