Yesterday in Parliament

Tucked away in prime ministers' questions yesterday (held by Harperson deputising) was a question from the redoubtable Ann Winterton . She asked for confirmation that:

… the real reason for part-privatising Royal Mail stems directly from European Union postal legislation, which forced Royal Mail to divest itself of its most profitable business, thereby handing it over lock, stock and barrel to European competitors.

According to Ann, there was a sudden hush in the House - an embarrassed silence – almost as if someone had done something unmentionable in church. Then Harperson, dutifully briefed by her gifted civil servants, delivered her "non-answer". The "real reason", she said, was "the analysis in the Hooper report, which we commissioned as long ago as December 2007."

Now, this is an interesting response, as the Hooper Report tells us that the real reason for part-privatising Royal Mail is ... er ... European Union postal legislation, and also EU state aid rules.

Basically, says Hooper, Royal Mail needs to modernise, which requires considerable investment. But "that transformation would have to be carried out under European rules on restructuring aid." That in turn would "impose considerable restraints" and thus take time. But, unless Royal Mail can modernise faster than EU rules would allow, "a forced restructuring under European rules is highly likely."

That, concludes Hooper, "would be a costly and poor outcome for the taxpayer, for consumers, for Royal Mail and its employees." By contrast, he adds, "private capital is generally more flexible and more tolerant of necessary risk. It can be raised more easily, faster and for a wider range of purposes and does not come at the cost of competing public priorities."

Thus does Hooper recommend that "there should be a strategic partnership between Royal Mail and one or more private sector partners." And, while the precise nature of such a partnership is a matter for the Government to negotiate, at its core, "will be Royal Mail's obligations under the universal service, as required under EU and UK law." The UK law, incidentally, largely transposes EU law.

Why Royal Mail cannot fund its modernisation programme from its own resources is explained by Booker in his column . Here, the problem is Britain's keenness to comply with three EU postal services directives, designed to end national postal monopolies by 2010 and to promote "cross-border" integration of the EU's postal services.

Because of these, Royal Mail had to surrender the most profitable part of its operations, when bulk business mailing was opened up to rival firms. It still has to deliver business mail, for a knock-down price of 14p an item, while the 19 companies that bid successfully for the business of collecting and sorting them cream off all the profits. This was a major factor turning Royal Mail's profits into a £179 million annual loss, which means it has no money for its modernisation programme.

As to why other European postal services have not been similarly affected, Hooper himself notes that "the UK has been amongst the first countries in Europe to open the postal sector to competition." In other words, this is exactly the situation described by Booker.

So why was there such a deathly hush in the House? Well … the Conservatives are supporting the Government, against the Labour back benches, to get the legislation passed.

The last thing the Tories want is for it to be known that the privatisation programme is entirely driven by the EU, thus putting the party in a position of supporting EU rules. This, with the euro-elections coming up, would not conform with their new-found (and temporary) image as a eurosceptic party.

Thus we had the hush of anticipation, bolstered by a frisson of fear, in case Harperson gave the game away. When she did not – and, of course, she was not going to – there was a collective sigh of relief. Business continued as usual – in Europe and ruled by Europe … but this must never be admitted.

NEWSBLIGHT

Last night, Lord Mandelson was the subject of a pussycat interview with Kirsty Wark on Newsnight, one of the BBC "news" programs that long ago convinced this author that the BBC news was no longer worth watching. The first part of the interview was about the now "famous" (because the media have worked it up to be so) comment by Shriti Vadera about the "green shoots" she could supposedly see in the economy. Listening to other comments, it was clear she had been caught out by a sly journalist, slanting his/her question in a way designed to catch out the interviewee. This is a well-practised tactic and one of the ways in which the media generate their own agenda.

But more importantly, Ms Wark questioned Lord Mandelson about the government's intention to sell off part of Royal Mail, most likely to the Dutch company TNT. Lord Mandelson warbled happily along, smiling and preening, and explained that things in the Royal Mail were jolly well not good enough and that the government were determined to change that. If it took the presence of a "partner" company to improve the service then so be it. Lord Mandelson said that he was "passionate" about the universal service obligation.

Well, yes, Lord Mandelson should be passionate about the universal service obligation because its his job, as a member of our provincial government, to carry out the instructions from our real government in Brussels, which is to ensure that that universal service obligation is provided within a steadily decreasing state service with all the rest sold off into the private sector to ensure that the market for postal services is "liberalised" in accordance with the two EU Directives that require it.

Why on earth is it that journalists like Kirsty Wark, and presumably by extension, the whole Newsnight team, are incapable of discovering the simple fact that the government is OBLIGED to sell off the Royal Mail and its nothing at all to do with Lord Mandelson? Its a simple, elementary fact to discover. Is it because they are the real Little Englanders and simply cannot see beyond Dover?