One advantage of a blog is you can flag up curiosities before they become mainstream news. Take the threat of industrial action over foreign workers, which I mentioned here three weeks ago.

I mention this before drawing your attention to a small and obscure clause in the Hooper report on the modernisation of the Royal Mail.

Lord Mandelson, who wants to bring in a private investor into the public group, is at odds with unions who want to see some form of state aid instead. But Hooper makes clear (I think it’s on page 64) that state aid would have to get past Brussels. To do this, he explains, the company would have to carry out options which could include a] radical restructuring and b] closing the final salary pension scheme to existing members.

It seems obvious that b] would be politically explosive. Even in the private sector this has hardly ever been tried before. (Rentokil did it a couple of years ago and kicked up a furore.)

It wouldn’t surprise me if we see Mandelson using this threat to cow the unions into submission later in the year. I can already see the headline now: “Two hundred thousand Royal Mail workers to lose their pensions if they resist part-privatisation, says business secretary“. Remember: you read it here first.

January 31, 2009 5:09pm in Business vote, UK economy | Comment