No privatisation for the Post Office ruled out

THE GOVERNMENT is today expected to rule out privatisation of the Post Office but to give the service more commercial freedom, in a move which will be warmly welcomed by postal workers.

The future of the Post Office has been under review since Labour came to power and there have been reports that ministers considered a sell- off, with workers being given pounds 2,000 each in free shares as a "sweetener".

But Peter Mandelson, Secretary of State for Trade and Industry, is understood to have backed an independent, publicly owned corporation model favoured by the Communication Workers' Union. Mr Mandelson is expected to make a statement to the Commons today which could be followed in the New Year by a White Paper on the future of the Post Office.

Sources at the Department of Trade and Industry said there would be a "radical reform" of the service, which would answer the Post Office's demands for greater freedom to compete in the global market. Its privatisation could have netted the Treasury pounds 2bn.