The Business Secretary Vince Cable confirmed in a statement to MPs the intention to float a majority stake in Royal Mail.
As he announced that staff would hold 10% of the business under the proposals – members of the Communication Workers Union took to an open-top bus in the City to denounce the sell-off, some holding placards saying “Save our Royal Mail” and “You own it, don’t buy it.”
They argue that they care more about the future of the service, their pensions, jobs and working conditions than a ‘sweetener’.
Mr Cable said the flotation, which is expected to value the business at £3bn, would begin over the next year.
He told the Commons: “These shares will be free to eligible employees, recognising that many of them would otherwise find them unaffordable.”
The shares will be available to the general public as well as institutional investors, he said.
He said the flotation, which was expected to value the business at £3bn, would begin over the next year and the shares would be available to the general public as well as institutional investors.
He said the flotation, which was expected to value the business at £3bn, would begin over the next year and the shares would be listed on the London Stock Exchange and be available to the general public as well as institutional investors.
“This is logical, it is a commercial decision designed to put Royal Mail’s future on to a long-term sustainable basis,” he said.
“It is consistent with developments elsewhere in Europe where privatised operators in Austria, Germany and Belgium produce profit margins far higher than the Royal Mail but have continued to provide high-quality and expanding services.
“Now the time has come for Government to step back from Royal Mail, allow its management to focus wholeheartedly on growing the business and planning for the future.”
Labour said it would oppose the flotation.
Shadow Business Secretary Chuka Umunna responded: “Having nationalised the organisation’s debts by taking on its pension liabilities, they now want to privatise the profit at the very time it is making money.
“There is every sign this treasured national institution is being sold off on the cheap to get income quickly to a Treasury whose economic strategy has failed.”
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