Mandelson backs down on Mail privatisation
Wednesday, 1 July 2009 5:01 PM
By Ian Dunt
Lord Mandelson has admitted there is no prospect of the government pushing through its bill to part-privatise Royal Mail.
Speaking in the Lords today, the business secretary said: "Market conditions have made it impossible to conclude the process to identify a partner on terms that would give market value to the taxpayer."
The government would look at the issue again "when market conditions have changed", he added.
But parliamentary analysts are not entirely convinced by Lord Mandelson's argument, pointing to a the high level of opposition among Labour backbenchers as an alternate explanation.
Around 180 Labour MPs have signed a motion calling on the government to keep Royal Mail in public ownership.
The Tories, who support the reform, are making considerable political capital out of the government's problems, with David Cameron highlighting the struggle as evidence of Gordon Brown's waning authority.
The Liberal Democrats made the same point today.
"This is an humiliating climbdown for the government," said Lib dem business spokesman John Thurso.
"It is quite clear that Gordon Brown no longer has the political will to fight the unions and opponents on his own backbenches.
"The government first told us that the plans were being postponed because there wasn't time to debate them. Now we hear that market conditions are the reason. They really should make up their minds."
Lord Mandelson had already admitted the legislation was being "jostled for space" in the parliamentary agenda, but today was the first official confirmation it was being laid to rest for the time being.
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