Alex Singleton | Journalist and political commentator

The British government’s postal company, Royal Mail Group, is currently suffering from trade union-organised strikes. Royal Mail’s sorting facilities badly need more mechanisation, as has been introduced by all of Royal Mail’s competitors. The Communication Workers’ Union disagrees. The strikes are bad news for the future of the company as they will help encourage customers to switch to other suppliers like rival UKMail and newer technologies like email.

The real question is: why on earth does the British government own a postal service anyway? It doesn’t own British Telecom any longer; why should it own Royal Mail Group? In 1994/5, the Dutch postal service, KPN, was sold by its government owners. Now, as TNT, it is a major international player, competing directly against Royal Mail.

As EU member states liberalise their postal services, companies who have become private sector players early on will have a competitive advantage. They will have already built up expertise at competing internationally and have taken advantage of private sector capital to become major players. If Royal Mail Group plc wants to be a major player in the European postal market of 2020, a public floatation now would be a huge advantage.

Some people think it’s wrong for something that’s “Royal” to be in the private sector (though it doesn’t seem to be a problem for the private global player the Royal Bank of Scotland). But really the issue is whether you want a sickly, unsuccessful Royal Mail that’s hammered even in its home market by TNT and Deutsche Post, or one that’s a British success story throughout Europe.