25.04.2007

Post workers under attack

At the end of last week, Royal Mail announced that it would accelerate the privatisation of crown post offices by transferring 85 of them to the tender mercies of WH Smith. Initially, 70 are to due to go this year. Jim Moody reports

Royal Mail unashamedly admits that any employees transferred to WH Smith would certainly be worse off than those employed directly. Speaking on Radio Five Live on April 22, chief executive Adam Crozier claimed that Royal Mail workers are paid 20%-25% more than those doing similar jobs in other companies. However, the actual reason he gave for the transfer was to reduce the rates bill paid for prime city-centre offices.

There can be no doubt that this latest privatisation is inspired and backed by the government. While the Royal Mail Group is a public limited company, it is wholly owned by the government; it is the parent company of Royal Mail, Post Office, and Parcelforce Worldwide. And it is Post Office Ltd that runs the 14,300 post office branches across the country, including the 458 crown post offices. He who pays the piper calls the tune, and the New Labour government of Blair and Brown is certainly calling this tune.

In fact, the Royal Mail Group's ownership of the Post Office makes it the largest retail and financial services chain in the UK - bigger than all of the UK's banks and building societies put together. The Post Office is the biggest cash handler in the country, handling more than £90 billion a year. For every £1 in circulation, 17p goes through a post office branch, where around 360 million household bills are paid each year.

However, across its network, the Post Office makes a loss on its operations of some £2 million a week. Part of the reason for this is a steep decline in government business over the last 10 years, from the time when the majority of business transacted was on behalf of government departments. Payment of pensions and benefits directly into bank accounts has already cost it £400 million a year in lost income. And once the government withdraws the post office card account in 2010, its revenue from government work will shrivel to around 10% of overall business. These rearrangements of capitalist state housekeeping have resulted in a situation that management within the Post Office thinks it can use to batter the workers it employs and rob them of their livelihoods.

So it was as an adjunct of government that the Royal Mail Group made its announcement last week that 70 crown post office branches would move to nearby WH Smith stores under a new 'partnership agreement'. Management's incentive to do so is clear. Underlining what the Post Office could not hide, the Communication Workers Union reported that the incomes of the workers involved would crash, from the less than princely £10 an hour currently paid them by the Post Office to a measly £6 an hour, which is what WH Smith pays. To add insult to injury, transferred employees would also lose their final salary pension scheme - WH Smith closed its final salary scheme in January this year.

To its credit, the CWU was quick to respond to this latest management ploy, exposing it for the crushing attack on wages and conditions that it is. Immediately Royal Mail made its announcement, the CWU set in train its established process for consulting all its members employed by Post Office Limited for a national ballot for strike action.

Over the last 16 years the number of crown post offices has been more than halved to 458, with Tesco, Spar, and the Co-op having taken over some of them in recent months. The hiving off that was announced last week follows successful (only in Royal Mail's terms, of course) pilot schemes to hand over branches in Ashton under Lyne, Altrincham, Swansea, Shrewsbury, Slough and Hammersmith. But the consequences for union members who formerly worked in closed or transferred crown post offices have been dramatic. Many have either had to take voluntary redundancy or been forced to accept redeployment in other branches, often with the result that many now have a much longer commute to work.

In the worst kind of public relations tradition, Royal Mail may pretend that this privatisation is for the benefit of customers and that the 373 remaining under Post Office control will become "flagship branches". But this patent lie is strongly refuted by the CWU, which states: "We maintain that all existing crown post offices are flagship branches." CWU members are not about to give up lightly what they have fought to achieve in terms of wages and conditions and the union is in no doubt about what lies behind this attack on its members: "Management's ultimate objective is to reduce the pay bill and costs ... it is an attack on members' jobs, wages and terms and conditions."

The wider working class movement needs to oppose this attack on workers' pay and conditions. As the CWU states, "Trade union-organised jobs are being replaced with the dumbing down of wages with un-unionised workers on minimum wages. Effectively, it is the exploitation of working class people ... seeking to destabilise union influence because of so-called market forces."

Precisely. The main aim of privatisation has not been to subject nationalised industry to 'the discipline of the market' - for the most part it has resulted in privately owned monopolies. The main aim, in combination with the anti-trade union legislation, is the weakening of union power through the fragmentation of state companies, legally preventing their workers from acting as one. The CWU is at present one of the strongest unions and if Royal Mail succeeds in hiving off this comparatively small section of its membership it will certainly look to repeat the process in other areas.

Interestingly Amicus, which organises workers at WH Smith (as well as managers in the Post Office, as it happens), also opposes the transfer. Nonetheless, it will need more than strong words to see off this latest attack: the resistance of the two unions must be coordinated - if not by their leadership, then by the rank and file.