The government has pushed ahead with its controversial plan to part-privatise Royal Mail by introducing the Postal Service Bill in the House of Lords, which sets out its proposals.
This follows the publication of the Hooper Report in December 2008, which warned that Royal Mail was lagging behind European rivals in terms of efficiency
and this, coupled with a pensions black hole, required urgent action to prevent the company's collapse.
Introducing the bill, Business Secretary Lord Mandelson says: "The bill...[allows] for a strategic partner to bring experience and investment to transform Royal Mail, with the government taking on its pension deficit.
"Royal Mail is lagging behind its international counterparts and this needs to change. A partnership must not just bring in access to capital, it must bring in expertise."
So far TNT, which runs the Dutch postal service, is the only private company to publicly declare an interest in obtaining an approximate 30% stake in Royal Mail Belgian rival De Post-La Poste is also rumoured to be bidding.
The government says it wants the deal signed off by the summer it will be assessing bids based on the price offered, the ability to modernise the service, and the capacity to handle trade unions.
The Communication Workers Union says there is "no convincing argument for privatisation".
Reed Business Information Limited.©2009
