By John Q. Hosedrinker 
The UK government approved the £5.3 billion sale of International Distribution Services (IDS), Royal Mail’s parent company, to Daniel Kretinsky’s EP Group. This acquisition, subject to a national security review due to Royal Mail’s vital infrastructure status, includes legally binding agreements to maintain UK-based operations, the universal service obligation, and a government “golden share.” A key aspect of the deal provides Royal Mail employees with 10% of dividends and establishes a workers’ group to engage with company leadership. The deal is expected to finalize in the first three months of 2025 pending shareholder approval.
Read the original article here
The sale of Royal Mail to Czech billionaire Daniel Kretinsky is expected to be officially announced this morning, triggering a wave of anxieties and commentary across the UK and beyond. This privatization of a vital national service raises significant concerns about the future of postal services in the country, echoing similar experiences in other nations.
The sale itself feels like another step in a worrying trend – the privatization of essential public services. Many are drawing parallels with the privatization of Portugal’s postal service after the 2008 financial crisis. That sale resulted in a significant deterioration of service, price hikes, widespread post office closures, and ultimately, less profit for the company overall. This serves as a stark warning of what might lie ahead for Royal Mail.
The assurances that Royal Mail’s headquarters, tax base, and corporate structure will remain British for five years offer little comfort to many. The vagueness of the “remain British” clause leaves open the very real possibility of relocation overseas – potentially to the Czech Republic – after this initial five-year period. This lack of clarity fuels anxieties about the long-term implications for jobs and the UK economy.
Concerns are not limited to the potential relocation of operations. The ongoing struggles of Royal Mail, including losses in its letter delivery business and heavy reliance on its parcel service, are significant. Many fear that under private ownership, the focus on profitability will exacerbate these existing issues, leading to further cuts in service and increased prices for consumers. The current situation, where the cost of posting a letter within the UK can exceed the cost of shipping a package from China, highlights the absurdity of the current system and underscores the potential for further deterioration.
The comments about Royal Mail’s struggles also point to a broader issue – the West’s seemingly dysfunctional approach to postal services. The ease and low cost of international shipping from sites like AliExpress, where the cost of delivery is significantly less than the cost of sending a letter locally, illustrates a fundamental failure in the structure and pricing models of many Western postal services.
Adding to the general sense of unease, many question the Labour government’s decision to allow this sale to proceed. The criticism points to a perceived lack of prioritization of vital national infrastructure, questioning the logic of selling off a service often deemed crucial for national cohesion and efficient communication. The sale also raises broader questions about the role of government in protecting and maintaining essential public services. This is particularly relevant given the ongoing issues with the organization, which may not be adequately addressed under a profit-driven model.
The sale is also seen as another example of the increasing foreign ownership of British businesses. The statistics cited, highlighting the significant percentage of large UK businesses already under foreign control, fuel anxieties about national sovereignty and economic independence. While some view the Czech Republic’s increasing international investment as a positive sign of its growing economic strength, many Britons are concerned about the potential loss of control and impact on national infrastructure.
Many are openly expressing disappointment and even despair at the situation. The narrative around this sale is not merely about economic factors; it’s deeply intertwined with national pride, anxieties about the future, and disillusionment with the political processes that have allowed it to happen.
In the end, the sale of Royal Mail to Daniel Kretinsky is more than just a business transaction; it’s a potent symbol of ongoing economic and political shifts, raising significant questions about the future of essential public services in the UK and beyond. The coming years will undoubtedly reveal the full consequences of this decision, and whether the assurances offered will prove sufficient to mitigate the anticipated concerns.