The coalition Government announced it would seek to inject private capital into the business, including opportunities for employee ownership, in line with pledges made by the Conservatives and the Liberal Democrats in the run-up to the general election.
No details of how private capital will be attracted were given, although the Government will be well aware that the previous Labour administration had to shelve its controversial plans to part-privatise Royal Mail last year following a huge revolt by backbench Labour MPs and a campaign of opposition by the Communication Workers Union.
Billy Hayes, the union's general secretary, said: "This is old politics wrapped in new language. The British public has consistently rejected the privatisation of Royal Mail. The move to regurgitate failed policies will be deeply unpopular."
But Business Secretary Vince Cable said there was "nothing sensational" about the announcement, adding: "Both coalition partners realise we have got to grapple with that problem. You may remember Lord Heseltine tried and failed, the Labour government tried twice and failed.
"There are big problems around the pension fund and we are going to have to deal with it. We have made it very clear that the injection of private capital is an important part of that.
"Certainly an issue we have emphasised is working participation and ownership, these are things we need to look at. It is a big issue that can't just be left in the long grass, it has got to be dealt with."
The Programme for Government document said: "We will retain Post Office Ltd in public ownership. We will ensure that post offices are allowed to offer a wide range of services in order to sustain the network, and we will look at the case for developing new sources of revenue, such as the creation of a Post Office Bank."
The Royal Mail's profits for the last financial year increased by 26%, despite a series of strikes by postal workers and falling mail volumes, with 13 million fewer letters posted every day than in 2005.
The Royal Mail said the latest performance showed the positive impact of continued modernisation in the business and increased efficiency, issues which sparked last year's dispute.
