Mail sell-off is market state's 'wild experiment'

The privatisation of the Royal Mail after centuries in state hands is not simply a carve-up of a public service for the benefit of big business and shareholders. It’s also another step down the road towards a fully-fledged market state.

A market state’s task is to provide opportunities for capitalism within the formerly public realm. That can mean everything from taking over parts of the NHS, running prisons, operating trains and – now – delivering letters and parcels.

This vision of the contemporary capitalist state is shared by all the mainstream parties. Royal Mail can be privatised quickly because the previous New Labour government created the conditions for this to happen.

In 2006, the Royal Mail lost its 350-year old monopoly and the British postal market became fully open to competition. A bid to privatise the service failed after a revolt by backbench Labour MPs.

But last year, legislation was passed which created the conditions for next month’s sell-off. The mail service will be sold on the stock market and quickly fall into the hands of equity funds, pension funds and global investors. It will be run for profit which means a ruthless rationalisation of services, especially outside the major towns and cities.

Naturally, the sale of Royal Mail has been brought forward to try and beat the programme of strikes planned by the Communication Workers Union.  The CWU is pinning its hopes on a Labour government renationalising the service. That’s not going to happen, as Ed Miliband’s party is committed to the present government’s spending plans. And that doesn’t include spending £3 billion or so in taking the royal mail back into public ownership.

Labour’s policies are being shaped around Miliband’s idea of “pre-distribution” and “responsible capitalism”. The role of the state here is to encourage and “incentivise” the private sector to pay better wages and treat their workers better. Old-style state control it isn’t.

As for Miliband’s would-be partners in a future coalition government, it is significant that the privatisation of the mail service is being pushed through with enthusiasm by Vince Cable, the business secretary. Once touted as a Liberal Democrat that Labour could work with, Cable is totally pro-business.

Billy Hayes, general secretary of the CWU, points out the overwhelming hostility among the public to privatisation, with 70% opposed according to one poll. But that cuts little ice with a government responsible for a national debt that is increasing at a rate of £3,200 a second. The sale of the Royal Mail won’t make a huge difference, but every little helps.

Hayes is confident that his members – 96% of  who say they are against privatisation, despite being offered a bribe in the form of shares –  will vote for a programme of rolling strikes. “Privatisation will destroy a national public service and lead to a race to the bottom on jobs, pay and conditions. It is vandalism, and must be stopped.”

But how? The British capitalist market state is the most advanced in its ambitions to divest itself of its former role as custodian of public assets and will sell them to whoever wants to buy them.  Railways, airports, water, nuclear power stations and much more are owned by global corporations and banks whereas the American state jealously guards national assets from foreign control.

Even when it comes to the mail, only a handful of countries have privatised their services. In Argentina, it was such a disaster that it had to be renationalised. A taste of what British postal workers can expect is shown by the experiences in the Netherlands . PostNL, formerly a subsidiary of TNT, is driving down wages and conditions and is planning to restrict deliveries to three days a week.

So Hayes is partly right when he says the ConDems’ plans amount to a “wild experiment”. But that’s the nature of the beast. Rather than relying on Labour, the CWU would be better off joining with the teachers, firefighters and other sections coming into conflict with the coalition this autumn.

Their aim should be to develop support for action to oust the government and launch a discussion on what kind of new, democratic economic and political system should replace the discredited market state. That’s the way to protect and develop public services.

Paul Feldman
Communications editor

The future of the CWU is at stake

Billy Hayes, the general secretary of the Communication Worker Union (CWU), denies saying that his organisation was in a stronger position than the miners were at the start of their strike 25 years ago. Nevertheless, the miners’ historic, year-long struggle for jobs is a suitable reference point for postal workers.

The difficulty the CWU has in reaching an agreement with Royal Mail management has echoes of the challenge that the National Union of Miners (NUM) and Arthur Scargill faced. Eventually, of course, the NUM returned without an agreement with the state-owned National Coal Board (NCB) and pit closures followed soon afterwards.

No agreement was possible because the state, directed by the Thatcher Tory government, was determined to shut pits that were deemed “uneconomic”, mines that did not make a profit. A quarter of a century later, the state-owned Royal Mail, directed by the New Labour government, is adopting a similar standpoint.

Commercial profitability is what drives Royal Mail management. “Modernisation” in their terms means the destruction of tens of thousands of jobs. By all accounts, the draft agreements have been so vague that the CWU executive has felt unable to sign on the dotted line and call off the strikes, whatever the recommendation of the negotiators led by assistant general secretary Dave Ward.

Tens of thousands of jobs have already gone in recent years with the CWU doing little about it. Signing up to the management’s agenda this time could well sound the death knell of the union as a fighting force because membership could be halved within a short time.

So if the CWU leaders are serious they have no time to lose in mobilising against the management AND New Labour. It is simply dishonest for them to call on business secretary Lord Mandelson to intervene. Mandelson has – and it’s on the side of the management.

New Labour is the main enemy. This government imposed capitalist, profit-making criteria on the Royal Mail, which is why thousands of post offices have closed and the delivery service has deteriorated as a result of cost-cutting measures. It has long ceased being a public service in the accepted sense of the word.

New Labour is ready to return with plans to part-privatise the Royal Mail, which it has shelved and not abandoned (if they lose the election, the Tories will carry on where Mandelson left off). The massive state financial deficit from bailing out the banks makes a sell-off a racing certainty.

One of the key lessons of the miners’ strike is that no single group of trade unionists on their own can defeat the government and the state, which in this case includes the employers and the anti-union laws that serve to weaken effective industrial action (the Tories are planning to impose new laws on top of those retained by New Labour).

The future of the CWU is at stake and union leaders must say so loud and clear. They need to mobilise the membership in indefinite strike action and defy the anti-union laws to picket out the strike-breaking force being recruited by Royal Mail.

In place of redundancies, the CWU should demand job sharing at no loss of pay to advance the right to work in a period of mass unemployment. In place of overpaid Royal Mail management, there is a case for a joint worker-consumer control of the service.

Making the post a genuine public service will require a government that is not in the grip of big business and the banks, as all the major parties are. That’s a tall order but the CWU, by being decisive and rejecting naked commercialism, could help open a discussion about achieving a real political change.

If the union leaders are serious about winning this fight, they need to show it or step aside for those who are committed to saving every job.

Paul Feldman
Communications editor

Plot to destroy postal union

New Labour and Royal Mail management have hatched a thinly-disguised plot to destroy the Communication Workers’ Union (CWU) if postal workers go ahead with their strikes next week over jobs and pay. That’s the clear message from the leaked document obtained by BBC’s Newsnight.

Behind the strategy is business secretary Lord Mandelson, who more and more seems in charge of the government. Gordon Brown is beholden to Mandelson after he blocked attempts to remove him as prime minister earlier this year. Mandelson has described CWU’s strike plans as “suicidal” and has come out against intervention by the arbitration service ACAS.

Mandelson withdrew plans to for a partial sell-off of Royal Mail because potential buyers signalled that the service needed “modernising” first. Since then, management has unilaterally introduced new working practices, leading to a series of localised strikes by postal workers.

Next week’s two days of national strike action (22 and 23 October) have been called in a bid to force Royal Mail to reach an agreement with the union on a way forward. But the leaked document shows that management and the government are not interested in a compromise but want to fatally weaken the CWU to prepare the state-owned service for privatisation.

The Royal Mail document marked “in strictest confidence” talks of “shareholder support” for the hard-line position - the government is the company’s only shareholder. Dated 24 September, the secret plan suggests that Royal Mail will effectively “de-recognise” the CWU by denying union reps facilities to carry out their activities.

The document also raises the possibility of managers delivering the mail and scab labour also being recruited. The PowerPoint presentation, obtained by BBC's Newsnight has a section marked “objectives” which states that “through the dispute” Royal Mail will “deliver the necessary 2009 changes with or without union engagement”. It refers to strikes as an "enabler" of its aims, saying "strikes make things worse".

Billy Hayes, general secretary of the CWU, told the BBC: "There is no question the document is genuine, what's more worrying is that Peter Mandelson seemed to know the document quite well. It does seem like an organised attempt to sideline the union. What we need is an agreement to modernise the company with the consent of the workforce. We want an agreement and we want to negotiate with good faith."

This is clearly not on the agenda, however. The government and management intend to break the union’s resistance and carry through their own programme of rationalisation and redundancies to add to the 63,000 workers already cut from the payroll over the last few years.

Right-wing papers like the Daily Mail are already salivating about the prospects of a re-run of the miners’ strike of 1984-8, when the Tories deployed the state to batter the union and impose pit closures. And yet the CWU inexplicably continues to fund New Labour to the tune of £1 million a year and express surprise at Mandelson’s position.

The argument has been that funding buys “influence” with the government and that the Tories could be much worse. Well, it seems more likely money down the drain when you consider Mandelson’s position and it’s hard to see the Tories planning anything harsher than the current government.

New Labour wants to demonstrate to big business and the middle-class electorate that it can be “tough” with the unions and workers. That’s why the government also intends to postpone the introduction of rights for temporary workers until 2011 required under European Union law.

The CWU is facing a fight to the finish with the government and management and it better get ready for this. Postal workers will need the active support in industrial action of other trade unionists, especially those in the public sector facing imminent pay cuts and job losses, if they are to defeat the New Labour government.

Paul Feldman
Communications editor

Postal workers need first-class leaders

The three to one majority in favour of strike action by postal workers is proof enough that trade unionists are prepared to sacrifice to fight for their jobs and conditions. Unfortunately, the same cannot be said about the leadership of the Communications Workers Union (CWU) who seem ready to settle for very little indeed.

Postal workers undoubtedly want to keep their (low-paid) jobs at a time when mass redundancies are sweeping through the economy. That’s why they enthusiastically supported the ballot for strike action.

But far from fighting for every job, the CWU leaders actually want the Royal Mail to include them in negotiations about “modernisation” and actually accept that this will mean fewer staff. Union leaders have accepted that “jobs have to go” – they just want to have a say on where the axe falls.

Management has unilaterally reduced services, torn up collective agreements, cut earnings and intimidated staff. This has led to a series of well-supported local walk-outs over the past few months.

What angers the CWU leadership, however, is that they have been cut out of the process. General secretary Billy Hayes says that it “is our view that a labour-intensive industry cannot be modernised unless the workforce is treated with respect”.

So the union’s main demand? In the words of Hayes: “…our members and negotiators are demanding a new national agreement to carry through the modernisation of Royal Mail.”
Adopting management-speak, Hayes calls for a “new engagement with the workforce” so that the dispute can be resolved.

Not only that, CWU leaders are pleading with the New Labour government to put pressure on Royal Mail management to step in. Well, they already have done – on the side of the employers of the state-owned service.

As you will recall, the government only postponed a part-privatisation of the service because no buyer could be found in the middle of a recession. New Labour patently refuses to fund the £7 billion Royal Mail pension deficit – a drop in the ocean compared to the hundreds of billions thrown at the banks.

The government is responsible for imposing a market-driven, commercial framework on the postal service in line with its mission to erode the lines between public and private services in the interests of profit-driven corporations.

Yet Hayes once again appeals for New Labour to carry out its “responsibilities” in line with a motion carried at the party’s recent conference. This is worse than hopeless. Rank-and-file posties deserve better leadership than this. They must demand that the aims of any strike action are crystal clear:

• No redundancies whatsoever. Royal Mail is making a profit while chief executive Adam Crozier is on a £3 million-plus package after shutting thousands of post offices
• Occupation of any sorting office/workplace threatened with sackings
• A halt to the commercialisation/privatisation of the mail service
• Instead of “engagement” with management, fight to bring the service under the democratic control of workers and users.
• Immediate disaffiliation of the CWU from New Labour. Why fund a party that is intent on destroying jobs?
• Launch a campaign with other unions to show how not-for-profit services benefit the public and how this is the way forward in the midst of a capitalist economic crisis.

There are real indications that Royal Mail is provoking a strike, knowing that the CWU leadership is weak and will try to settle at the earliest opportunity. Rank-and-file postal workers must become aware of this and be prepared to replace their leaders with those who are committed to the defence of jobs, pay and services.

Paul Feldman
Communications editor

New Labour hits the buffers

It was yet another New Labour panacea. Bringing in private finance would make public spending go further and transfer the risk from the taxpayer to companies. Who cared whether it was public or private sector that financed and/or delivered services and projects – what mattered, we were assured, was “what worked”.

Well, it has turned out to be yet another New Labour con-trick. The collapse of the National Express rail franchise and the failure to find to a buyer for part of Royal Mail, are sure indications that the entire policy is in ruins – and that taxpayers and workers will be made to pay the price if the government gets half a chance.

The whole approach was, in any case, founded on the serious illusion that global capitalism had an infinite appetite for “public-private partnership” (PPP), and that the world had entered a new period of endless, stable economic growth. There was enough spare capital to replace what the state used to do.

So the state’s role was simply to facilitate the corporate-driven globalisation process. A key departure, started under the previous Tory regime, was to privatise state assets, including rail. New Labour took this further and before long the state was a “commissioner”, inviting the corporate sector to get involved on a grand scale.

And it did. Under Brown as chancellor and Blair as prime minister, the value of contracts for public services held by the private sector grew to over £80 billion. A third of all services are, in one form or another, contracted out to companies and charities, a higher proportion than any other major economy.

We are talking about school building, school services, schools themselves in the form of Academies, hospital projects, health services, air traffic control, employment services, welfare provision, London Underground, sections of the legal and justice system, prison building, large parts of council housing, defence technology – in fact, you name it and it is almost certainly been given the PPP treatment.

Now both outright privatisation and PPP is floundering as the economic meltdown gathers pace. Metronet pulled out of the London Underground project and left passengers to pick up the tab in higher fares. Many college and school building projects are in difficulties.

National Express – or should that be National Excess because their fares are eye-wateringly high – have reacted to falling passenger numbers on the East Coast route by simply walking away from the contract struck with the government in 2007. The company is simply not going to pay the £1.4bn due to the government by 2015.

The transport secretary, one unelected Lord Adonis (whatever happened to the Commons?), plans to take the franchise into state ownership later this year – and then retender it in 2010. But no one expects bidders (if there are any out there) to offer what National Express paid. One of the factors behind the franchise’s demise is that the government itself got greedy and encouraged bids that were in practice dependent on impossible increases in passenger numbers.

So we are left with the situation where neither the capitalist state nor capitalist corporations are in a position to deliver on contracts or services that are essential in a modern society.

The state, as we know, is essentially broke after giving the banks vast sums in a futile bid to prop up the financial system, while the corporate sector is slashing jobs and shutting down operations in every sector. What will happen to the pensions of Royal Mail workers, for example, now that capitalist firms have failed to come to the government’s aid?

This is an unacceptable position. Britain is not a poor country. Its workforce creates vast amounts of added value when it has the opportunity. The economy has just been hijacked and then wrecked by the political class and its corporate friends. There can be no stronger case for removing their power to do any further damage.

Paul Feldman
Communications editor

Bosses attack as union leaders run up white flag

The sacking by the Total corporation of 900 construction workers at the Lindsey oil refinery in Lincolnshire last night, who were on strike in defence of their jobs, is part of a growing employers’ offensive against trade union organisation which is also behind today’s strike by 8,000 postal workers in London.

The 900 were constructing a new plant at the refinery in Lincolnshire and were part of about 1,200 contract workers who had taken strike action in a dispute over jobs when, as one part of the project ended, 51 redundancies were announced. Shop stewards say that normal practice would have been to offer the workers vacancies on other ongoing contracts on the site but this was not done.

Victimisation is suspected because the 51 worked for Shaw, the contractor that was at the centre of the dispute earlier this year about the employment of foreign labour. Managers started hiring Italian and Portuguese workers. This sparked walkouts at refineries, gas terminals and power stations across the country.

The strikes at Lindsey have spread to other power stations at Drax and Eggborough in Yorkshire and Ratcliffe in Nottinghamshire, and BP's Saltend refinery near Hull. Workers have also walked at the BOC oxygen plant at Scunthorpe, Fiddlers Ferry in Cheshire and Aberthaw in south Wales, the trade union Unite said. Energy company E.ON said up to 150 contract workers at the Ratcliffe-on-Soar power station also walked out in support of the Lindsey oil refinery strike.

Total, the French-based global oil corporation, directed its main contractor to end all sub-contracts on the project, thus terminating the employment of all 900 workers involved. They were vulnerable to unilateral action by the company because officials from the GMB and Unite unions had refused to make their strike action official out of fear of the restrictions imposed by anti-union legislation.

In fact, the company said the workers had been involved in "an unofficial, illegal walk out" that was "repudiated" by both Unite and the GMB union. All a spokesman for Unite could say was: "We are extremely concerned about the ramifications of the employer's actions. We are urging all parties to get back around the negotiating table to resolve this situation." Not exactly fighting talk and unlikely to concern Total.

Meanwhile, the Communication Workers Union (CWU) said up to 8,000 members in London were due to walk out this morning with workers in Scotland due to strike on Saturday. The union has accused Royal Mail of cuts which break a national agreement and threatened modernisation. Deputy general secretary of the CWU Dave Ward said: "We are now seeing cuts but not modernisation in the postal industry and there's only so long before this is going have a major impact on services.”

Here again, union leaders are begging rather than fighting. They have offered the employers and the government a three month no-strike deal if they agree to work with the union on modernisation and, according to Ward, “move to get the company on a sound footing for the future".

The Lindsey sackings and the postal workers’ struggle demonstrate that the refusal of union bureaucrats to fight the employers and, in the case of the CWU, the government which is going ahead with plans to part-privatise the service, is one reason why unemployment is soaring throughout the country. Employers are aware that union “leaders” live more in fear of the anti-union laws than them and are acting accordingly to impose the economic crisis on the backs of workers.

Ending the wretched system of sub-contracting in the construction industry and defeating New Labour over privatisation requires policies of social ownership and workers’ control of the corporations and the mail service – and leaders that will fight to carry them into practice.

Paul Feldman
AWTW communications editor

Behind the Royal Mail sell-off

As postal workers gather outside Parliament today to lobby the government over plans for a partial sell-off of the Royal Mail, as a prelude to mass redundancies, any lingering doubts they might have had about where New Labour’s priorities lie should be dispelled by reports of yet another bail-out of the banks.

The extra £500 billion in liabilities taxpayers are said to be facing to prop up RBS and Lloyds will take the state’s commitment to the insolvent banking system to a staggering £1.3 trillion (£1,300,000 million if it makes the total any easier to understand). That’s equivalent to the value of the British economy’s output for a whole year. 

Meanwhile, on the back of a paltry – by comparison - £5,900 million deficit in the Royal Mail’s pension fund, New Labour is planning to sell off part of the company to a transnational corporation. New investment will be undertaken at the price of “modernisation” of this nominally public service, resulting in large-scale job losses and price increases. The break-up of post office services is an indication of what is to come. 

That, at least, is the plan and it is entirely consistent with New Labour’s role in life. This is to use the capitalist state to create opportunities for global companies operating in Britain to extract maximum profits from working people. With the capitalist economy in freefall, new opportunities for profit-taking are most welcome by business and part-privatisation does just that. 

It is no use the Communication Workers Union leaders pussy-footing around in a futile bid to try and isolate business secretary Lord Mandelson, who is introducing the legislation in the House of Lords on Thursday. Prime minister Brown and the rest of the cabinet are equally behind the sell-off because they are unreservedly committed not just to the preservation of but also to the enhancement of corporate and financial interests. 

Yet the transfer of wealth from taxpayers to banks will not avert the slide into slump that is now taking place at a rapid pace on both sides of the Atlantic. In America, Citibank and AIG insurance are once more on the point of collapse. Wall Street has fallen back to 1997 levels. A new shock to the system is being prepared that will produce social outrage and upheaval in country after country. The massive anti-government demonstration in Dublin at the weekend – equivalent to a march in London of 1.5 million – is a sign of what’s coming up the line. 

That’s why Brown’s bovver boys – aka the Metropolitan Police – are letting it be known that they are preparing for a "summer of rage". Superintendent David Hartshorn, who heads the Metropolitan police's public order branch, said. "Obviously the downturn in the economy, unemployment, repossessions, changes that [public mood]. Suddenly there is the opportunity for people to mass protest. It means that where we would possibly look at certain events and say, 'yes there'll be a lot of people there, there'll be a lot of banner waving, but generally it will be peaceful', [now] we have to make sure these elements [“extremists”] don't come out and hijack that event and turn that into disorder." 

There are also reports that a secret police intelligence unit has been set up to spy on political groups, to mount surveillance and run informers on “domestic extremists”.  The unit is being set up by the unaccountable and secretive Association of Chief Police Officers (Acpo) and will be based at Scotland Yard. Acpo was instrumental in co-ordinating the attacks on miners during their 1984-5 strike. 

Postal workers should challenge their leaders to start from these realities and mount a real, militant campaign against the Royal Mail sell-off. They would find ready allies throughout the country if they were involved in action to defeat and bring down New Labour to defend their jobs and pensions.  Any other course is sure to reinforce the government’s determination to pursue its role as the agency of big business. 

Paul Feldman
AWTW communications editor