Royal Mail lobbies for government to transfer 20% share to staff

LONDON – Royal Mail chairman Allan Leighton has told MPs that he wants to give employees a 20% stake in the organisation, but Royal Mail is not in a state to be fully privatised.

Appearing before a Trade and Industry Select Committee on Tuesday, Leighton said that he was optimistic of getting government support for issuing shares to Royal Mail's 180,000 employees through a specially created trust.

Royal Mail is worried about its future funding, which it says will be challenged by its £4bn pension scheme deficit and the need to invest £2.2bn in modernisation, and is seeking to improve its balance sheet.

It has also publicly said that its overall mail volumes are down 1% in the current year, with a spokesman blaming the state of the economy and a downturn in credit card acquisition mailings.

It is currently negotiating with Postcomm on the terms of its price control for the next five years.

It wants to be allowed to raise the price of first class stamps from 30p now to 39p within five years. Postcomm has said that stamps should increase only to 34p.

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