Christine Jardine: Privatised Royal Mail may prosper

The modern world has left Royal Mail behind, so selling it makes sense on several levels, writes Christine Jardine

'Royal Mail is one of Britains biggest and strongest brands.' Picture: TSPL

IT’S an easy totem to be nostalgic about. After all, privatising Royal Mail would surely mean redundancy for Postman Pat, to say nothing of his beloved cat.

And to be honest, my first reaction was shock when I heard that the government I not only supported but worked for was selling it off.

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Were they really going where Peter Mandelson had failed and Margaret Thatcher had not dared?

But gradually as I researched beyond the tabloid headlines and thought about it in detail it began to make sense.

After all, when was the last time I ordered a delivery and expected it to arrive in the daily post?

That same daily post that arrives after I’ve left for the day, and on the odd occasion that it does have a parcel, leaves an infuriating little red card demanding that I go at an inconvenient hour to an inconvenient place to collect it.

I’ve lost track of the number of times it has taken me days to carve out an opening in my timetable to drive across town to pick up something that should have been delivered to my door. But that’s not to blame the Royal Mail. They are working within constraints.

I am also among the tens of thousands who have abandoned cards and letters in favour first of telephones then social media to communicate. So if something is broken, what is wrong with trying to fix it?

If an organisation is hog-tied and unable to compete, what is wrong with freeing it to pursue private investment, not just to survive, but perhaps even prosper? And that is the key.

Royal Mail is one of Britain’s biggest and strongest brands. Its turnover is currently around £9 billion a year. In the past six years more than £2bn has been invested in improvements and cost efficiencies, but will it be enough?

As online commerce has grown, so have alternatives to the Royal Mail. It now needs to be able to compete not just with international postal carrier but the internet and smartphones too.

To do that effectively it needs more investment, but rather than take that from the taxpayers’ pockets again, the government is opting to give us all the option to invest. And 150,000 employees will be given free shares.

Sound familiar?

Discussing the news reports with younger colleagues, I found myself asking if, given the choice, they would reverse the privatisation of British Telecom.

Met with blank stares, I explained there was a time when households only had a landline, that they could only get from British Telecom with only their model of phone and paying the tariff they set. There was no alternative if you did not like it.

The BT we know today is very different. Freed from the constraints placed on a nationalised utility, it has been hugely successful. It has grown and diversified. First mobile phones, then broadband, now even a platform for football.

But there was one nagging doubt. In the immediate aftermath of the announcement there were those who claimed it would be the end of vital services to remote areas.

Critics claimed that the Royal Mail would go the way of so many other carriers and charge those outwith our biggest cities more for deliveries.

As someone who lives a great deal of their life either in the Highlands or Aberdeenshire, I know the impact that can have.

If you have any AB postcode – even one for the centre of Aberdeen – you can often find that once you have ordered something over the internet you find it is going to cost you more. Because of that post code.

On occasion you can even get a phone call from the carrier a few days before you expect delivery to tell you there is an extra charge. Perhaps even as much as the original purchase itself.

It’s a problem that the private members bill introduced at Westminster by Sir Bob Smith MP currently aims to tackle. And it’s a problem that cannot be extended to the Royal Mail.

The universal service provision, with six-day deliveries to every area of the country at the same price, is guaranteed by legislation. In the free market, who is to say that will not give the Royal Mail the edge on competitors – or force competitors to offer the same?

There will, of course, be those who ignore all of this and claim it is a return to Thatcherism. Or they will claim that it is a threat to the future of vital rural post offices, forgetting that the coalition has protected them by making them the front counter of government services in communities.

For me the criticisms don’t hold water. What we have is a government proposing a remedy to a problem we have all, in this age of fast technology communication, contributed to.

And if Alex Salmond is serious when he says the move should be delayed until (he hopes) an independent Scotland comes along, let him put his money where his mouth is and explain how taxpayers here would fund a renationalisation.

Do any of us really think that would happen? Surely Scotland’s varied and often challenging landscape just makes the case for 21st century communication tools, delivered via broadband, even stronger, and reinforce the need for the Royal Mail to be allowed to compete?

So maybe there is no cause to worry about Postman Pat after all. Or perhaps with his free shares tucked away in his bank account, and the private investment allowing his employer to grow and compete on an international stage, he might decide to hang up his bag and retire to the sun.