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Wow a £750 million pounds ($1.2 billion) rip off this is what you get when you sell off a publicly owned institution to the private sector. The privatization of the Royal Mail (UK Post Office).

Some low-lights

The government's desperation to sell Royal Mail cost taxpayers £750m in a single day, the National Audit Office has said in a scathing report into the privatisation of the 500-year-old national institution.
Achieving an additional £750m from the sale could have covered the annual salaries of an additional 34,000 NHS nurses.
But the real stink comes here:
The audit office said the government's pricing decision was largely influenced by Cable's desire for "long-term, blue chip" institutional investors to buy and hold large chunks of Royal Mail shares.
As you can guess the result of this long term investment strategy Is:
However, the audit office said six of the 16 "priority investors" selected by Cable had sold all of their allocation within weeks of the float, at a substantial profit.
Oh wow quelle surprise.

Champagne all round.

Note when ever conservatives and their allies want to sell of public companies you just know

1] They will undervalue the sale.

2] Huge profits will be made by their backers.

Lazard was paid £1.5m for its advice. The government spent a total of £12.7m on fees to bankers, including UBS, Goldman Sachs, Barclays and Merrill Lynch, accountants, lawyers and PR advisers.
Oh the stench, it's highway robbery.
Billy Hayes, general secretary of the Communication Workers Union that represents postmen and women, said the report "finds the government guilty"of overseeing a "get rich quick" scheme which offered no value to taxpayers.
Ain't it always?

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Comment Preferences

  •  Of course once the Royal Mail is sold off to (6+ / 0-)

    private interests it will no longer be the Royal Mail.

    The only way to save the British monarchy is a bit of socialism.

    We're shocked by a naked nipple, but not by naked aggression.

    by Lepanto on Tue Apr 01, 2014 at 03:03:10 AM PDT

    •  Everyone goe down to the Post Office (1+ / 0-)
      Recommended by:

      never heard anyone going down to the Royal Mail to buy their stamps, post letters or get their pensions.

      Always been a little sign of Republic for me


      •  OK who stole an "s"? Hmmm! (0+ / 0-)
      •  Not now (0+ / 0-)

        Last time I had to post something (which I do so rarely that I still have Silver Jubilee special 1st class stamps in a book of 6!) it was indeed at a post office location but I had to put it in the pillar box outside. Stamps are available at virtually any general store or supermarket or labels can be printed at home or in the office.

        Pensions, unemployment and social security (welfare in US terms) "cash" payments are paid in bank accounts and withdrawn at ATMs, very few of which charge for withdrawals.  Admittedly some main post offices do have ATMs outside so some might go to one to get their cash out. (Incidentally, banks are required to provide basic bank accounts, which do not have overdraft facilities or make charges, to facilitate this). In fact, there are now very few "Crown Post Offices". Most are run as "sub-office" concessions within corner stores etc.

        One of the problems with the Post Office and Royal Mail has been the loss of functions as technology has advanced. Along with the paying out of cash, they used to collect the cash for things like rents, local taxes and utility bills on behalf of others. Most have now moved either to electronic payments or using a cash paying in facility available at corner stores.
        Similarly they are about to lose the issue of road fund tax discs. Part of that involved checking the physical paperwork to ensure the vehicle was insured and, if over 3 years old, had a "MOT" certificate that it is roadworthy. There is a national database of the MOT records and one with links to insurance details. Most police patrol cars have either radio or computer links to these databases and some have automatic number plate recognition that alert to any uninsured, stolen or untaxed vehicles. So the utility of the round paper certificates that currently have to be displayed on the windscreen is much reduced. They are to be abolished so the road fund payments will have to be made on line.
        Parcels and passports will be about the only reason to go into a Post Office. The passport form acceptance process is optional and many now apply on line. This is yet another area where they have lost income from the Government direct. The parcels service has increased competition from courier services like DHL. Letters and the big income earner, Christmas Cards, are being replaced by email.

        If you go to a local Crown post office now, you will see they are increasingly relying on retail sales of stationery and cards themselves to be financially viable in the location.

        "Come to Sochi, visit the gay clubs and play with the bears" - NOT a Russian advertising slogan.

        by Lib Dem FoP on Tue Apr 01, 2014 at 05:28:37 AM PDT

        [ Parent ]

        •  One of the cool things about the USPS... (4+ / 0-)

 would be a profitable business if not for the huge payments hung over its neck by the Republican congress back in 2006, right before they were kicked out. It's a shame no one thought to get rid of these onerous "pension pre-payments" while the Democrats held the congress.

          The USPS delivers more packages than any other delivery service in the USA. It would be even more profitable if it were allowed to run a small-deposit bank - as it once did, from around 1910 - 1966. Hell's bells, let it issue small loans and we can kill off the predatory payday lending industry as well.

          Back on topic: yeah, this entire sell-off of the Royal Mail smacks of corruption and the plutocracy.

          Join Essa in a revolt against the gods. Continue the fight, Causality.

          by rbird on Tue Apr 01, 2014 at 07:11:18 AM PDT

          [ Parent ]

  •  Actually, given the UK government's... (1+ / 0-)
    Recommended by:

    ahem... rather obvious lack of competence, the two might not be mutually exclusive (if you're going to build nuclear plants - which I support - it's probably not a good idea to court probably the most politicised and corrupt segment of the industry to do it).

    In any case, if the goverment were serious about the long-term partnership thing, they could easily draft the contracts in such a way as to restrict or prevent the sale of shares without the state's permission.

    Iuris praecepta sunt haec: Honeste vivere, alterum non laedere, suum cuique tribuere. - Ulpian, Digestae 1, 3

    by Dauphin on Tue Apr 01, 2014 at 03:05:14 AM PDT

    •  They do what they are told to do (4+ / 0-)
      Recommended by:
      Dauphin, hannah, Egalitare, samanthab

      incompetent or not, and that has been my opinion of conservatives on both sides of the pond.

      •  True that. Conservatives are people who value (3+ / 0-)
        Recommended by:
        LaFeminista, Egalitare, a2nite

        power over other people above everything else. I suspect it's because they are people of little creative talent. Since they can't be creative in the sense of manipulating and transforming their material environment, they resort to manipulating other people and moving them around.  Sort of like sheep dogs. In Australia, they're called blue heelers because they nip at the sheeps' heels to get them to go where they want. The herding instinct. I suppose it is less destructive than predation.

        by hannah on Tue Apr 01, 2014 at 03:37:28 AM PDT

        [ Parent ]

        •  So when can you all kick out those blokes? (0+ / 0-)

          How soon is the next general election there slated to be? Cannot come soon enough, apparently...

          P.S. Since the Postal Service is Constitutionally-mandated here, the Repubs in Congress cannot privatize it...but they've tried every way possible otherwise (see above) to cripple it financially...

          "Those who forget the past are doomed to repeat it."--George Santayana

          by GainesT1958 on Tue Apr 01, 2014 at 07:47:59 AM PDT

          [ Parent ]

          •  Yes, because the Postal Service guarantees (0+ / 0-)

            privacy to the citizenry and Congress is jealous of their monopoly of secrecy. Under the guise of prohibiting dangerous substances in their mail, they've virtually cut out receiving written criticism from citizens (which they have to keep in their files) and limit the acceptance of emails to that from constituents. The citizenry, which proposes to tell representatives what to do, is the enemy.


            by hannah on Tue Apr 01, 2014 at 08:55:01 AM PDT

            [ Parent ]

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