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Interesting statement from Vince Cable, stating the privatisation will now allow the Royal Mail to compete:

Personally, I wouldn't believe Vince Cable if he told me it was October.

That old chestnut about allowing public utilities flogged off on the cheap in order to "compete" is as empty-headed in the 1980s as it is now. Have the gas companies "competed" since privatisation? Obviously not, all Thatcher did was replace a state monopoly with a privatised monopoly owned largely by overseas companies.

I could give you hundreds of examples of how privatisation of services that YOU once owned, Zorro has been a bad move. Here's just one...about the East Coast MainLine which is in public ownership since the previous private company just walked away.

Journey numbers have grown from 18.1 million in 2009-10 to 19.1 million in 2012-13. An estimated ?800 million will have been generated by the franchise for the taxpayer by April 2014. All of that has resulted in a ?40 million surplus: money that would otherwise be providing the profit to shareholders, if the line were privatised.

I don't think anyone could make a decent case for the railways not to be re-nationalised ? if only we had the money...

One of the key blocks to re-nationalisation is the vast amounts of money required to do it. For example if you had bought ?1,000 of BG shares in the 1980s they would be worth about ?45K now.

In the case of Royal Mail we are seeing signs that the government has drastically undersold the company. The first day sales touched a 39% price rise in share value at one point. So in the totally unlikely event that the government decided that this was a big mistake and they decided to buy back the shares, they would have to pay a close on 40% mark up just a few days later after the privatisation.

Insane!

And since it is a legal requirement for companies to make as much profit as possible for their shareholders, how long before the price of stamps hits ?1 and continues to rise? The government has promised that won't happen. I don't believe them ? you?

Not just stamp price issues, how long before they are allowed to charge different rates for distance? At present it costs the same to post a letter to the outer Hebrides from London as it does to the next street. Bet that's out the window PDQ.

Now it's private, and probably soon foreign as well, owned, surely it cannot be allowed to keep the 'Royal' bit of the name.

I reckon Royal Mail will end up with some offshore based, foreign company like so much of British industry that will load the organisation with debt used to make the purchase.

Later on the company will threaten the government with the prospect of collapse of the mail service if they are not allowed to put up prices etc etc.

Having said that there has been a big drop in the amount of letters being sent as people of all ages switch to using email, social media to keep in touch. Even my 89 year old uncle uses email to keep in touch with people. On top of that there has been a huge increase in the amount of internet only communication/bills etc. with utility companies and banks etc.

So if they do put up prices for letters that could be counter-productive. Where I do see potential big increases is in those areas where you do not have such choices like sending/receiving parcels.

The Royal Mail can't put the price of parcels up as it is the one boom area that is currently well serviced, what they plan on doing is trying to increase their share of this marketplace, but need to invest heavily to do so, as they are currently way behind on some of the services other companies offer.

"Royal Mail can't put the price of parcels up as it is the one boom area that is currently well serviced"

Can't? We will see.


" what they plan on doing is trying to increase their share of this marketplace but need to invest heavily to do so, as they are currently way behind on some of the services other companies offer."

And obviously that investment could have been provided by the government who apparently have ?50 billion to spend in return for the dubious economic benefits of HS2.