Business secretary Vince Cable has announced that Royal Mail employees will be offered reduced or free shares as part of the government’s plans to privatise the organisation.
In his speech to the Liberal Democrat conference, Cable said the postal service would benefit from the largest employee share scheme resulting from any privatisation for 25 year,s with employees set to receive at least 10% of shares.
Cable said: “My colleague Ed Davey is doing valuable work promoting mutual ownership and also – as in the Royal Mail – spreading worker ownership alongside private capital.
“I want to announce today that employees in Royal Mail will benefit from the largest employee share scheme of any privatisation for 25 years. The Liberal Democrats were the first and only party to call for an employee stake and we are now implementing it in government. The Post Office is not for sale. There will be no programme of closures as there were under Labour.”
The Employee Share Ownership Centre (ESOP) welcomed Cable’s announcement but believe employees should receive more than 10% of shares.
Malcolm Hurlston, chairman of ESOP, said: “Change is coming to Royal Mail. It is of huge importance that employees have a significant stake to ensure the ethos of the service is preserved. Previous employees share models in privatisations have followed the BT model too slavishly but this must be avoided with Royal Mail.
“However, other models have been deployed where the employees received more meaningful stakes. Under the demunicipalisation model used for bus companies, employees received as much as half of the business.”
The Communication Workers Union (CWU) has condemned the offer of shares as patronising. The union’s general secretary Billy Hayes, said: “Any offer of shares to employees is deeply patronising for people have invested their working lives in this public service. The British public currently owns 100% of Royal Mail and now 90% is to be sold off to the banks and financial institutions that have created Britain’s current financial crisis.”
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