UK Post Office to Axe Up to 20% of Staff

25 March 2002

Consignia, the recently rebranded British Post Office, decided over the weekend to sacrifice up to twenty per cent of its workers in a bid to remain solvent.

The publicly-owned corporation will need to convince the government that its plans are politically acceptable. And given the recent admission by acting chairman Alan Leighton that its rebranding was ‘probably’ a mistake now too expensive to reverse, Consignia may also need to convince the politicos of its competence to execute any recovery plan.

Leighton, the former chief executive of Asda prior to its acquisition by Wal-Mart, is shortly expected to be confirmed as Consignia's permanent chairman. He will argue that the group's parcels delivery unit, Parcelforce, cannot continue to serve all customers.

This would result in the loss of nearly half the unit’s 12,000 workforce, leaving it to focus solely on express deliveries plus the basic residential parcel delivery required under its universal service remit. Parcelforce has posted losses for ten consecutive years and accounts for a disproportionate percentage of Consignia's daily £1.5 million cash haemorrhage.

Additionally, word from within the bunker is that a further 40,000 jobs are at risk at Royal Mail, Consignia's letterpost division – thirty thousand through layoffs plus a further 10,000 through natural wastage and the outsourcing of support services such as transport.

The Communication Workers Union [whose members’ wildcat antics are partially responsible for Consignia’s present plight] has promised to fight compulsory redundancies.

Data sourced from: Financial Times; additional content by WARC staff