Billy Hayes, UK postal union president, addresses the APWU Convention

Text of the speech by Billy Hayes, President of the Communications Workers Union (UK):

Thank you for the invitation to address your convention. A special thank you to your new President, Mark Dimondstein, for his hospitality. I am sure he will measure up to the problems you face.

I understand that your biggest campaign at the moment is against the decision of the USPS to locate counter facilities in Staples stores.

In the UK we are very familiar with such moves. Management have been transferring Crown offices facilities to WH Smith – a private retailer.

It results in fewer services and poorer working conditions. So, good luck with your campaign.

I also note that the USPS is dogged by the requirement to make large annual payments to pre-fund future retiree health benefits.

This sounds like an arbitrary attack on a public service. I assume someone in Congress had the idea of creating an artificial financial crisis, in order better to justify privatisation.

Equally, I understand you are pressing for the introduction of postal banking. Again in UK, we are campaigning for the establishment of a Post Bank.

Many postal services throughout the world have one, and they are usually very profitable. But you will be competing against private banks – and they are such delicate creatures that they can’t take the competition.

But let me explain more fully the struggle that we have been having in the UK.

You may have heard, but in October last year, Royal Mail was privatised.

It came after a long battle. The first suggestions were made in the early 1980.  Overall, we faced four major public fights on the issue.

In 1994, the Conservative government led by John Major, attempted to get a Parliamentary Bill through for the sale.

The government was vulnerable – it was towards the end of its’ elected mandate. It had a small Parliamentary majority.

And it was seriously divided following the bitter recriminations after Margaret Thatcher was dumped in an internal coup.

So the union played on these divisions in our campaign.  We concentrated our lobbying on the rural seats of the Conservatives where they had a small majority. We argue that these constituencies would be the most seriously disadvantaged if Royal Mail was privatised.

We went very deep into the enemy’s camp – hiring a lobbying firm that was associated with Thatcher.

We did this alongside our more traditional campaigning.

But playing on the internal party divisions worked wonders. The government withdrew the Bill because of a revolt by rural MPs.

In the late nineties and early in 2000, we had to deal with the Labour government under Tony Blair, which had a strong affection for private markets.

Unfortunately, the Blair government did not allow for Royal Mail to make the investment in modernisation it needed. That government preferred to see the market liberalised and Royal Mail be subjected to competition.

Of course, this was in line with the rest of the European Union, where Postal Services Directives were implemented which removed the state monopolies.

Consequently, Royal Mail was in an ambiguous position. It was forced to compete, but was not allowed to seriously invest, as other European postal providers were able to do.

Inside Blair’s government, there were many politicians who approved privatisation, including of Royal Mail.

At the same time, senior Royal Mail managers were being directly recruited from private companies and were anxious to see it privatised.

So our next major public fight began in 2004, when the Chair of the Royal Mail at the time, Allen Leighton, began a public campaign for privatisation, which he suggested should include distributing shares to postal workers.

His campaign took the form of a public lobby.  He had excellent platforms in the media – as he had worked for Rupert Murdoch’s company.

The Labour government was divided on the issue. Some senior figures were definitely in favour.

Our key tactic, this time, was to win the majority of Labour Party members and Ministers to our support.

So, we lobbied consistently amongst MPs and supportive Labour Ministers.  We won the vote at Labour Party Conference. And we negotiated a policy for Labour’s 2005 General Election manifesto which ruled out privatisation.

When Labour was re-elected in 2005, Leighton continued his campaign suggesting that Labour’s manifesto had “wriggle-room” for privatisation.

We stepped up our campaign to make sure there would be no wriggling.  But this was a long, sustained fight which involved almost non-stop lobbying to get politicians to uphold party policy.

Management’s proposal was not explicitly rejected by the Labour government until January 2007.

This three-year campaign was successful – but still the government refused to allow the amount of investment required.

After the onset of the great economic stagnation in 2008, the funding of Royal Mail became critical.

Instead of allowing the necessary investment, the responsible Minister attempted in 2009 to launch another Parliamentary Bill for privatisation.

The minister concerned was Peter Mandelson – a very close associate of Tony Blair. His preparedness to break Labour traditions had earned him, in Labour circles, the title of “Prince of Darkness”.

Mandelson placed his Bill before parliament in 2009. Once again, our tactics had to take into account the precise political situation.

The Labour government have recently seen a change of Prime Minister – from Tony Blair to Gordon Brown.  The party had a Parliamentary majority but not too large – and, it was coming to the end of its term.

Mandelson was a divisive figure, and was regarded by many in Labour as part of leadership whose time had passed.

Our major aim was then to simply split the party on the issue from top to bottom, including inside the Cabinet.

We did all the usual campaigning – meetings, rallies, demonstrations, petitions, etc

But our sharpest edge was organising the opposition inside the party – both in parliament and in the party structures.

We were very successful in this – we had senior ministers arguing our position inside Cabinet meetings; we had a majority of Labour backbench MPs signed up to oppose the Bill.

Of course, under pressure politicians sometimes promise one thing and do another. But we knew that the opposition was strong enough to create problems for the Prime Minister.

It could be anticipated that there would be sufficient Labour MPs voting against the Bill to mean that it would only get to be carried with Conservative support against the Labour rebellion.

Wisely, Gordon Brown decided against this and the Bill was allowed to` drop.

Our most recent struggle began shortly after the 2010 General Election, which resulted in a Coalition government of the Conservatives and Liberal Democrats.

This is a right-wing government where both parties agreed from the beginning that Royal Mail should be privatised.

The Coalition was elected with a Parliamentary majority of 85 – this is a strong position in British parliamentary terms.

The Coalition also decided to tackle the issue early in its government term.  It had also immediately launched a big attack upon the working class in the form of a harsh austerity policy.

This amounted to big cuts in wages and benefits, alongside reductions in public services.

Shocked by this assault, many people were very preoccupied with managing their declining living standards. Our campaign had to compete with a myriad of other issues.

The political situation for our campaign against the Parliamentary Bill launched in 2011 was then difficult from the outset.

Again, we tried a variety of tactics – including working in the marginal constituencies of the Coalition parties.

But the Parliamentary arithmetic was completely merciless. The government was able to secure the authority to privatise the company in passing the Postal Services Act 2011.

Bearing in mind the difficulties, the union spent a lot of effort getting amendments to the Bill that would protect the interests of workers, and the future of the industry.

We organised with supportive MPs to table and get carried, a variety of amendments. These included:

  • Strengthening the position of the Universal Service Obligation in law
  • Naming Royal Mail as the USO provider for 10 years
  • Resolving the outstanding pension deficit and maintaining the pension scheme.

There were other problems with privatisation that we had to address.  Royal Mail was to be sold, but Post Office Counters network was to remain a separate company, wholly owned by the government.

Clearly, there was a danger that a privatised Royal Mail would not wish to use a public sector network.

So, we campaigned for the establishment of a binding business agreement between these two bodies. This was successful with a 10 year inter-business agreement being signed.

This at least gave some guarantee that the Post Office network would not suffer widespread closures.

Our campaign ran the government close.  By the middle of last year, the government was desperate to get the sale in before the run-up to the General Election in 2015.

Opinion polls continued to show how unpopular privatisation was – seventy per cent opposed the sale immediately before it happened.

We also commenced a set of negotiations with the employer to protect the terms and conditions of postal workers in the event of privatisation.

To add bite to this, we organised a strike ballot. It is not legal to strike against privatisation, but you can ballot in defence of terms and conditions.

We got a 78 per cent “Yes” votes on a 63 per cent turnout.

Royal Mail and the government knew they would have to make serious concessions to settle the dispute.

But they were so rattled that they brought forward the sale, and offered a very low price for the shares.

The sale was in a panic, and badly mishandled. Because of the low price of the shares offered, it was 25 times oversubscribed.  By the end of the first day’s trading the share price had risen dramatically.

The fire sale price meant that the taxpayer lost nearly a billion pounds immediately on the sale.

The scandal of this continues to rumble in British politics.  The Coalition government has been seriously embarrassed by its blunder.

The settlement of the dispute was very favourable. In order to settle things down management made a range of concessions. These included:

* Maintaining all existing staffing agreements

* A commitment to no outsourcing or franchising of work

* Above inflation pay rises for a three-year period

* A commitment for the industry to remain primarily a full-time employer –with no zero hour contracts.

The deal was so good that when put to the membership it was carried by 94 per cent of members voting.

Disappointed as we were, we continue to pursue the defence of postal workers interests in the privatised company.

Immediately, we are facing new threats.  Direct delivery competition is being introduced into a number of major cities.

The competitor, TNT, plans to deliver to 42 per cent of addresses by 2017, but covering only 8.5 per cent in the UK’s geography.

They are simply cherry picking profitable urban areas. The assumption is that Royal Mail will continue to provide the universal service and pick up the losses.

We have commenced a campaign against this both to defend the USO, and to secure terms and conditions for all the workers in the sector.

TNT delivery workers are on zero hours contracts –  that is, no guaranteed hours, only what the boss offers on a day to day, or a week to week basis.

They also only pay the minimum wage or just above this.

Clearly, this is a threat to all workers in the sector. So we are pursuing this with a lot of energy.


I greatly value this opportunity to share our experience. Good luck with your deliberations at your Convention.

On behalf of 200,000 UK members of the Communication Workers Union, I offer you our solidarity and friendship.

Thanks for listening.