Acording to reports in the Sunday Telegraph the government's plan to part-privatise Royal Mail is "dead in the water" because Gordon Brown cant get it past his own party when it comes to a vote.

The chief whip has told the prime minister that the rebellion from backbench MPs means he does not have the support to get the Royal mail privatisation plan through the commons without the support of the Conservatives. It is unlikely that this weakened Labour government will want to push through any privatisation bill for the Royal Mail where they need the support of the opposition.

Previous speculation had cited TNT Post and private equity firm CVC were interested in  taking part ownership in Royal Mail if the privatisiation plan was ever going to come to fruition. It is believed that over 100 Labour MPs would vote against any plan to privatise the Royal Mail. On top of this the CWU (Communications Workers Union that repesents most postal workers) has made threats to cut its links to the Labour Party if the privatisation plan goes ahead.

One source stated that a major rethink is on the cards to save the blushes of Peter Mandelson who as Business Secretary has been involved in the privatisation plan. Sadly, the reality is that the government are facing up to the reality that Labour die hards and unions appear unwilling to face - Royal Mail volumes are still falling at an alarming rate. Take direct marketing where there is a massive shift away from direct mail in 2009 then this lucrative part of the Royal Mail revenues is likely to see in excess of a 20% fall this year. Add to that the rise of email and the fact that more and more consumers and companies are opting for paperless billing then the omens are not good.

Without significant modernisation over the years and the workers/union position then the Royal Mail is only slipping further and further away from being able to compete in the modern communications world. Privatisation of the Royal Mail or part-privatisation is one of the few options left to pull the service to a competitive position.

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