Govt battles Royal Mail aftermath

By politics.co.uk staff

The government has come under pressure to explain what it will do about the pensions deficit at Royal Mail after privatisation plans came through.

It had planned to pay off the fund’s £8 billion deficit as part of the part-privatisation deal, but the death of the proposals has put a spanner in the works.

Business secretary Lord Mandelson said it was now a matter for “the company and the pension trustees”.

He was also forced to bat away claims that the decision to scrap the plans related to the rising level of rebelliousness among backbench Labour MPs, around 180 of which had signed a motion opposing the move.

Originally, Lord Mandelson said the dropping of the plans was due to it being “jostled for space” in the parliamentary agenda, but yesterday he claimed it was due to “market conditions”.