Poll: Fears for future of rural postal services in places like Norfolk as government unveils Royal Mail privatisation plans
- Credit: PA
Plans to privatise the Royal Mail will allow it to become a 'great British company', business minister Michael Fallon has predicted.
A majority stake in the Royal Mail is to be sold off by the Government and staff handed 10pc of the shares free of charge, Business Secretary Vince Cable confirmed today.
Mr Cable told the Commons there would be a public offering of the shares and staff who wish to extend their free stake would have the first chance to buy.
He pledged the universal service and the six-day service would be protected in a private Royal Mail, insisting these commitments could only be changed by Parliament and not by shareholders.
Labour's Chuka Umunna told MPs the opposition continued to oppose the privatisation and said the Government had failed to provide any justification for acting now.
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Critics, including the Protect Our Post campaign in North Norfolk, have warned services in unprofitable rural villages were likely to be the first to go.
Denise Burke, chair of North Norfolk Labour Party, said: 'We believe these plans will be particularly dire for north Norfolk, a rural area with an increasing elderly population, because the services in the villages that do not make a profit are likely to be the first to go.
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She said the company was already being 'fattened' up by increasing the costs of postal services, and they feared it would continue to rise after privatisation.
Business minister MichaelFallon told BBC Radio 4's Today programme the time was right to push ahead with the plan: 'It is increasingly being run as a commercial business, it has modernised thanks to the efforts of management and indeed the workforce.
'It's been turned round in the last two or three years and it's ready now to take its place as one of the great British companies.'
He said the universal service obligation was written into the law which paved the way for the sell-off.
'Only a future parliament could change it and let me be very clear, we have no plans to do that,' he said.
Business Secretary Vince Cable is due to confirm that the state will keep hold of 49pc of the company after the initial flotation, with speculation that further chunks could be sold in future.
However, he is not expected to give any formal dates for the privatisation to take place.