Business Secretary Vince Cable's attempt to schmooze postal workers into backing the coalition government's plans to privatise Royal Mail by offering them one-tenth of the shares in their company get short shrift from their union writes John Haylett interviewing union general secretary Billy Hayes.

Communication Workers Union (CWU) general secretary Billy Hayes says: "We currently own 100 per cent of Royal Mail and we find the idea of giving a few shares to the workforce patronising."

Hayes is insistent that any problems at Royal Mail are already being resolved within the public sector.

"We've just entered into a modernisation agreement and it's just pure ideological spite that we're witnessing from Vince Cable at the moment."

Hayes points out that Cable, who was described as akin to a national treasure by Labour Party deputy leader Harriet Harman prior to the general election, is part of the Orange Book free-marketeer group within the Liberal Democrats.

"I think that the glitter is beginning to come off him now," he says.

"His speech to the Liberal Democrat conference was talk left, act right and, for a man who's attacking bankers, he's intending to give 90 per cent of Royal Mail to the finance houses, bankers and private equity firms.

"The only bottom line for them will be the privatisation of a great public service."

The CWU and campaigners against private-sector encroachment into the Post Office will draw sustenance from their success in derailing the previous privatisation attempt by Labour business secretary Peter Mandelson.

In his recently published book, written during the election campaign when most Labour supporters were striving to stave off a Tory electoral victory, Mandelson bleats about the crucial role played by the CWU in frustrating his plans, following publication of the report by former Ofcom boss Richard Hooper advocating that the government should sell a stake in Royal Mail to one of its private competitors.

"The CWU began to lean on Labour MPs to oppose the reforms and to warn that they would withhold support from candidates in marginal seats who backed the government's plan," Mandelson wrote.

"It used every political tool it could think of to try to whip up sentiments against the Hooper plan and modernisation."

"We plead guilty to that," Hayes says simply, giving due notice that the CWU will organise in a similar way, mobilising postal service users, community groups and public opinion in general to defeat this retrograde step.

Both the last Labour government and the current Conservative-Liberal Democrat administration have made much of the deficit in the Post Office pension fund as a means of putting pressure on the CWU to accede to their plans.

But Hayes notes that pensions fund problems are nothing new, having been around since 1969 when then Labour prime minister Harold Wilson created the Post Office Corporation and made it take on Civil Service non-contributory pension liabilities.

And it must be remembered that more recent problems have arisen because government allowed the pension fund not to be financed for 13 years - mainly under the Tories but also the early period of Labour government.

"That created the deficit, which is about £8 billion at present, but with that is £24bn of assets," he says.

"What the government is proposing is to nationalise the pensions fund, taking on the debt but also the assets, putting £24bn in the Treasury, so it's no free lunch that we're being offered. They are removing that debt so as to be able to reward their mates in the City.

"Only when we see the detail in the Bill will we be able to analyse fully what's on offer."

Hayes sees what is happening with Royal Mail as similar to a general offensive led by the International Monetary Fund and the World Bank to promote private-sector penetration of all government services.

The European Union has ordered the liberalisation of postal services in all 27 member states by 2013, allowing anyone to set up a postal company and obliging each country to have one universal state provider. In all cases, this is the former nationalised postal company.

"There is no obligation as such to privatise postal services rather than to liberalise," Hayes says.

"The case is sometimes put forward that these are effectively the same thing. I don't agree. There is a distinction, but it is difficult dealing with liberalisation."

Postal liberalisation took effect in 2006 in Britain, well before rest of Europe, under the aegis of new Labour's neoliberal zealots, but its main effect has been at the upstream end - predictably the profitable end - in the big sorting offices.

At the downstream end, what's called the final mile, post is still delivered by Royal Mail staff. In fact, they deliver more mail now to the front door of everyone's house than five years ago.

The Post Office monopoly on parcels delivery disappeared long ago, but Royal Mail remains the only company to guarantee parcel delivery to any address in the UK, which, as Hayes says, "goes to the heart of the tension."

He recognises that universality and free access to services are an anathema to neoliberals, pointing out that debate has started in the US over free access to the internet and how to narrow it down by charging for service.

"That's why you're beginning to get questions raised such as "Should footballers get child benefits?" It's the whole idea of universality that is under threat," Hayes warns.

And he is aware that it is not just the Con-Dem government that is guilty of pushing this neoliberal approach.

In his view, closer links between Labour and the unions are a good thing, but the CWU is an independent union, devising its policies on what it sees as best for its membership and for society as a whole and "we're not spoon-fed our policies."

Hayes says that Labour MPs "have to understand collectivism. People are getting sick of the 'me, me, me' society and want a more collaborative approach.

"There is room for quiet diplomacy, but there's also another way of doing it. To quote Margaret Thatcher, 'weakness invites aggression'."

He looks forward to a change in Labour's fortunes, though mindful that any Labour revival "requires labour. It requires the labour of ordinary rank-and-file trade unionists.

"We know that Labour is a coalition, but it has to be a coalition where everyone in it is happy and, clearly, that wasn't the case with the trade union movement."

The CWU invited all five of the Labour leadership candidates to put their case for support to its members and it was unique among the trade union movement in backing Ed Balls in the contest.

"Why Ed Balls? We got the best statement from him on the privatisation of the postal service. He's been fantastic, campaigning alongside us against privatisation. We listened to all the candidates and we thought that Ed came up with the best answers," Hayes explains.

"There's polling evidence already that he's beginning to punch a hole in the economic arguments of the coalition and I think that that's absolutely correct.

"We won't succeed in defeating the Tories until we come up with a coherent economic argument and I think that Ed Balls has begun to hammer out a credible economic alternative. I still think that we were right to back him," he says.

In common with other public-sector unions, the CWU is aware of the need to unite to campaign against the Con-Dem cuts agenda and to defend its members' interests.

But he also stresses that, with £175bn of government money spent annually on procurement from private companies, cuts will not affect solely the public sector.

"The problem that we've got at the moment is that the threat is very generalised and, when it becomes more concrete and much more real, people will become much more disenchanted," he forecasts.

"People are not going to put up with some of the things that are being planned for them and their response may well surprise some of us who have been around a bit longer."