Tories: Government must provide business vision

Thursday, 18, May 2006 12:00

The Conservatives have called for the government to provide a business vision of its plans for the Royal Mail, after it announced it would provide the company with £1.75 billion in investment.

The package is broken down into a loan of £900 million, repayable at commercial rates, and the release of £850 million from the company's reserves, usually inaccessible to the firm, to help it reduce its pension fund deficit and modernise its equipment.

Spokesman Charles Hendry said: "All of us want to see a successful post office but if government is going to part with this amount of money even if it is a commercial loan it must give us a business vision in terms of ownership, debt and competitiveness.

"We want to be reassured this is not anti-competitive and does not give Royal Mail an unfair advantage over other companies."