Opinion: Make the Royal Mail co-operative

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The arrival of a 60p first-class stamp should not come as a surprise. Just as I should not be surprised when the postman suddenly puts something through my letterbox. But I am always surprised at these little pieces of daily life. Prices go up and the post arrives “and thus we may see how the world wags”.

This time, however, it is different – because the whole Royal Mail, established in 1516, is about to be denationalised, sold off, privatised, cease to exist as an arm of the state, whatever term you want to use. The Postal Services Act, passed by parliament in 2011, paves the way for the mail service to be sold and for the network of post offices to be either sold off or mutualised – that is, passed into the ownership of its employees.

Well, if this model of co-operative ownership is being contemplated for the post offices, why not for the Royal Mail? The co-operative movement is growing in confidence these days, just as the private ownership model is in decline. The John Lewis Partnership, the Co-op stores and the Co-operative Bank being perhaps the best known examples, are all doing well. And in this UN International Year of Co-operatives, Scottish Enterprise has reminded us that there are 550 co-operative businesses in Scotland with a turnover of more than £4 billion.

The Royal Mail is particularly suited to being a co-operative venture since it is a virtual monopoly and aspires to be a national service with a universal service obligation, or USO, part of the European Union’s regulatory regime. This has led to the charming but utterly bizarre practice of little red vans driving up remote farm tracks to deliver mail to the furthest-flung citizens of the empire, at the same 60p cost as a letter sent across Edinburgh.

Not much wonder the Royal Mail made £120 million loss last year on its letters service, and nearly £1 billion over the last four years. Stamp prices just had to go up, from 46p to 60p (from 1 May) for first class stamps and from 36p to 50p for second class stamps – though there will be concessions for Christmas cards for those on welfare benefits.

The Royal Mail, of course, is facing competition from sources not easily foreseen by Henry VIII in 1516. Its parcel service is being undermined by the cherry-picking private sector in the form of TNT, FedEx and local couriers. And dear old letters themselves are becoming a thing of the past, unfortunately, with email, Facebook, Twitter and text messages taking over the communications network. The number of letters posted has fallen by 25 per cent since 2006.

Another problem facing the Royal Mail is the pension deficit built up by its 150,000 employees over the years. It now amounts to £9.5bn. The Chancellor, George Osborne, has said he is willing to take on this deficit, though what really attracts him is the pension fund’s £28bn pot of assets which will go immediately into his account – the £38bn of liabilities are all in the distant future, which he can ignore for the moment.

Mr Osborne, of course, is keen to swell his coffers further by selling off the Royal Mail – hoping it might be worth £4bn – in the biggest privatisation for 25 years. Bidders might include Deutsche Post from Germany, privatised in 1995, or the Dutch privatised service. But, interestingly, the French government has recently drawn back from selling off La Poste.

But whoever ends up owning the Royal Mail – a private company or a workers’ co-operative – there will have to be changes. There are too many red pillar boxes. The number of deliveries will have to be reviewed, especially in rural areas. Letters, after all, are no longer the means of urgent communication. And perhaps people living up remote farm tracks will have to install a post box down on the main road or go to their local post office to pick up their mail.

I do hope however that mailing will not die out altogether. I much prefer to receive my bills, appeals for money, notice of concerts, explanations of price rises, holiday suggestions, etc by post. And I much prefer to receive hand-written letters and cards from family and friends in a material form, rather than a virtual form. I like to hold them in my hand, turn them over in my mind, feel the same page that my correspondent has actually touched, left his mark or tears or blood upon. And it is all away from the ubiquitous computer screen where things can be lost or forgotten, or ignored, or hacked into. Posted letters have been with us for thousands of years, too long to be suddenly abandoned in this arrogant century.

So go on, Royal Mail workers, launch a bid for your own business and may your co-operative last for another 500 years.

[Visionary Man]