Privatised mail will need stamp of approval

He said the design of new stamps would have to be cleared by Buckingham Palace as part of a series of measures to protect the Royal brand.

Mr Cable said discussions were taking place with the Palace to ensure there was no "abuse" of the Royal association once the firm passes into private - possibly foreign - ownership.

Tory Roger Gale raised the issue during a debate on the Postal Services Bill, which paves the way to privatisation.

He said: "Since Queen Victoria, the Royal Mail has borne the Royal imprimatur.

"My understanding is that under European regulations it is not possible to restrict ownership of the Royal Mail once it goes on to the open market, so it could well be sold to the Dutch or the Germans."

Mr Gale asked Mr Cable: "How will you maintain the Royal Charter?"

The Liberal Democrat MP told him: "As far as the Royal Charter is concerned, it is clear that the association with the Monarchy is probably the most powerful brand it could possibly have.

"There will be every interest in the new owners continuing to maintain it.

"There are specific issues we need to be careful of, we need to be careful the new owners don't abuse the Royal association and we are discussing with the Palace how we build in those protections.

"And the Monarch will continue to have the right, which we are building in, to ensure that any new stamp, for example, is cleared by the Palace.

"So the Royal interests in this are fully protected and we are very sensitive to them and to their importance."