Slashdot Mirror
UK Gov't Outlines Plans To Privatize Royal Mail
Ellie K writes "After 500 years, Britain announced plans to fully privatize Royal Mail today. Shares of stock (common equity) will be offered to the public 'in coming weeks', according to Reuters. 10% of shares will be given to current Royal Mail employees, Deal size is estimated at $US 3 to 4.7 billion. Goldman Sachs and UBS were chosen as lead advisers." That doesn't mean you'll be able to buy a piece tomorrow, though; as the BBC's report notes, "The plans have provoked strong opposition from unions. The Communication Workers Union (CWU) is currently balloting members on strike action. Ballot papers are due to go out on 20 September to 125,000 Royal Mail workers. The earliest possible strike date would be 10 October. Plans to privatise the 250-year-old postal service have been on successive governments' agendas since the early 1990s."
Things will likely go the same as with every other UK public service that has been privitized: The service will get worse, costs for consumers and end-users will go up, fewer workers will be paid less, but some 'top executives' will be brought in to 'clean things up' and make a mint.
This plan is corruption at its most horrible. Activate the usual propaganda merchants to persuade everybody the government has a good plan for how to improve a public monopoly service, sell off the public asset to private entities, let politicians earn massive fees (bribes!!), increase prices charged to the public, cut costs thus boosting profits but decreasing the quality of service to the public, publish tons of fake statistics proving how much better it all is now, etc. We've seen all this nonsense before. The train services in Britain are outrageously expensive (compared to cars, planes, and buses), often late, usually dirty, with an aggressive security force with police powers of arrest. Thirty years ago, the public monopoly train service in Britain, called British Rail, offered a much cheaper, and more reliable train service to the public. Prices of many ordinary train tickets bought at the counter or automated ticket machines for journeys at peak times were less than 20% in real terms of the current equivalent ticket prices charged by the private companies who now greedily charge whatever they like. There is no free market. For most journeys, you simply cannot choose which train company to use. Similarly at whatever level of granularity they choose to convert it into private companies, the home-delivery portion of a postal service is a natural monopoly, especially in the more isolated, rural locations. During the last five or so years the public postal service in Britain has been the victim of a disgraceful government push to deliberately degrade the quality of the service, e.g. by encouraging a 50% increase in postal loss rates, so that when private companies take over, they can easily demonstrate an improvement. Etc etc
Oh fuck I don't even know where to begin with the kind of egocentricity which comes down to "one time one service didn't deliver for me therefore DESTROY IT ALL because the alternatives will surely be better".
Followed by a link to a Daily Mail article, which is as a reliable as a link to a BNP article.
Have you actually tried to contract with a truly privatised, subdivided, "free market" style delivery service, like Yodel? They are so fucking awful it's an insult that they're even permitted to operate.
We have a thriving competitive market in telecoms? Oh, Sir, you crack me up. We have VIrgin Media, Sky and BT, and almost all your "competitors" are actually using re-sold BT services which only exist thanks to a stringent framework of regulation which nevertheless still operates in BT's favour ("regulatory capture"). Fuck, BT are even required to artificially separate the operations of their divisions - BT Openreach, BT Wholesale, and BT retail, so it isn't so obvious how they take advantage of their position as a natural monopoly.
The US is certainly worse - because it's an order of magnitude more spread out than the UK, and its privatisation was even less regulated (so, for example, BT are required to provide a certain level of service, which in a lot of cases e.g. remote Scotland is provided through government sponsorship).
RM had already been broken up into such inefficiency (as above) that it was necessary to drive up prices to make it profitable again. Even the NHS suffers this problem: all your greatly indebted Trusts were involved in New Labour's horrible public-private partnerships. The problem isn't the lack of private sector involvement: it's the existence of subcontracting to the private sector, where none before existed.
The belief that profit produces a better service per se is ideological. It sometimes does - e.g. when there is a free market - but not for essential services, especially not when they form natural monopolies.
In 2006, the US Congress passed the Postal Accountability and Enhancement Act", which mandated $5.5 billion per year to be paid into an account to pre-fund retiree health-care, 75 years into the future.
Since none of USPS's competitors (Fedex, UPS etc) are required to do this, USPS has essentially been setup to fail & then be privatized.