In January 2006, the postal industry was opened up by the regulator Postcomm to full competition from private firms.
This was three years ahead of the proposed plan for this “liberalisation” to be introduced across the rest of Europe.
Just two years later, we are seeing Royal Mail in yet another financial crisis. This time it is as a direct result of Postcomm’s imposition of competition.
The regulator has allowed and actively encouraged private firms to cherry-pick the profitable bulk mail contracts that Royal Mail relies on to subsidise the universal postal service we all depend on.
But rather than admit that its policies have undermined the ability of Royal Mail to provide this public service, Postcomm is now pushing for partial privatisation.
Royal Mail’s top bosses Allan Leighton and Adam Crozier are also pushing for “private equity” investment.
For decades Royal Mail managed to make enough money to provide a one-price-goes-anywhere universal service at relatively low cost. This was because the service was effectively subsidised out of the profits made from bulk business mail.
Now, after Postcomm’s “liberalisation” policy allowed privateers to move in and skim off profits from the mail market, this regulator claims that the solution is to let the privateers buy into Royal Mail as well.
A partial sell-off of Royal Mail, or a “joint venture” with private investors, is being promoted as the way to raise the funds to “modernise” Royal Mail.
This would lead to a massive job-cutting efficiency drive through automation and restructuring – not in the interests of improving the service, but to maximise profits for the private investors.
It would also mean price rises for the everyday users of the postal service, as Postcomm wants to force this universal service to be “self-financing”.
Our CWU union must fight to defeat these privatisation-pushers once and for all.
Postcomm should be scrapped, and Leighton and Crozier sacked.
Then we can start to build a future for Royal Mail as a 21st century public service, 100 percent publicly owned, which can provide the public with the service they want and the workforce with the wages and pensions they deserve.
Simon Midgley, CWU political representative for Bradford & District Amal branch (personal capacity)
In April Royal Mail made drastic cuts to our pensions without any agreement from the union.
They ended the final salary scheme and introduced an average salary scheme, increased the retirement age from 60 to 65 and closed the existing scheme to new entrants.
These changes amount to a massive robbery of our pensions.
As a result I have lost, or I should say had stolen from me, £40,000 and many workers will have lost more than that.
We are told that this is simply an economic argument. Due to workers living longer and investment returns reducing, the scheme is unaffordable.
But pensions is very much a political question and not simply about economics.
Tony Benn said at a CWU meeting, to loud applause, that Royal Mail was a public service and, like the police service and the fire service, should not have to make a profit.
And why should Royal Mail have to fund the pension scheme with not a penny put in by the government?
After all before liberalisation Royal Mail made huge profits with most being paid directly to the treasury.
It is obscene that Adam Crozier, Royal Mail’s chief executive, receives a £3 million bonus for slashing jobs, destroying the Post Office network and reducing services and yet there is no money for the pensions of hard working postal workers.
We are living in the fourth wealthiest country in the world. This government can spend billions on Northern Rock and an illegal war in Iraq. Yet it cannot help fund our pensions.
CWU union members recently voted by 92 percent to reject Royal Mail’s pension changes.
The union’s executive has submitted an emergency motion to our annual conference which calls for strike action unless there are acceptable agreements on pensions, the long term future of the Post Office network and the future of the mail centre, delivery and distribution networks.
The question is – what does the union believe is acceptable on pensions?
The executive has been considering proposing an increase in pension contributions of
2 percent, effectively a cut in take home pay.
This is unacceptable – especially with the spiralling cost of food and energy, which hits low paid workers hardest.
We need to fight for something worth winning – a total reversal of Royal Mail’s pensions robbery and final salary pensions for all at 60.
Paul Turnbull, area processing rep for the Eastern No 4 branch
The relationship of the CWU to the Labour Party will again be the subject of intense debate at this year’s conference.
Even those on the executive who back continuing affiliation to the Labour Party agree that New Labour is “failing to adequately represent trade union members and working people in general”.
This follows last year’s national strike in which Gordon Brown called on CWU members to go back to work.
Highly critical motions, backed by a large number of branches, call for only the minimum level of affiliation to the national party.
They argue that the union should sponsor only those Labour MPs with a track record of backing the union.
This is a clear advance from days in which Labour could simply take the CWU’s money for granted, but prevents the union from funding any representative from a party other than Labour.
An alternative position put by a number of CWU branches calls for the democratisation of the union’s political fund so that parties other than Labour can also receive funding.
This motion offers the union a chance to reflect the growing anger with the government and keep its political voice in parliament.
But it is being strongly opposed by the majority of the executive.
A small number of branches call for immediate and complete disaffiliation from Labour.
Since CWU conference last year Royal Mail has added Oxford and Milton Keynes to its list of mail centres threatened with closure.
The emergency motion endorsed by the CWU’s postal executive to ballot members over pension reform and Royal Mail’s rationalisation plans is therefore very welcome.
However, it is essential to act upon this motion with a sense of urgency. It must be more than the hot air of last year’s motion, which threatened industrial action if any mail centre closures were announced.
Royal Mail is closing not only mail centres but also delivery offices. With the attacks on our pensions and with new starters on short term contracts (in effect a casualisation of the workforce), what is needed is a unified response on all these issues before the decline in conditions becomes unstoppable.
We should not, however, be offering compromises on any of them before we start the battle. We should not accept the closure of ONE mail centre any more than we should accept the raising of the pension age from 60.
The public deserves a world class postal service like the one it had in the hundred years before Allan Leighton and Adam Crozier were put in charge. And like the one it had before New Labour opened us up to liberalisation.Crozier and Leighton should be sacked for their crimes of vandalism against an essential public service.
There is no rational reason for shutting mail centres and distribution centres other than asset stripping and short term profit.
In Oxford we recognise that Royal Mail is determined to force through its changes whatever the cost. In closing the Oxford mail centre they will lose money as they do not even own the assets (the property) to strip.
This is an attack on our union branch and the CWU as a whole that sends an ominous message to the rest of the country. Royal Mail’s message is clear – we will attack you if you fight back.
Shutting any mail centre will have a devastating effect on the service. The CWU argues for a level playing field and an end to unfair competition.
Even if we accept competition, mail centre closures would leave us unable to compete. As a trade union we should be defending every mail centre, every job and every pension.
What is needed is a principled and determined fight against the effects of liberalisation.
This year we need to win on all these issues – or there will not be a service to defend.
Paul Garraway, branch secretary of South Central No 1
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