You are here: Home - Uncategorized -

Royal Mail share scheme snubbed by Government

Written by:

The Government has rejected a proposal from Royal Mail management that 20% of its shares in the company be distributed to employees as part of its UK investment in the operation.

Allan Leighton, chairman of Royal Mail, tried for several months to persuade the Government to accept the scheme – worth about £5,000 to each worker – but Trade and Industry secretary Alistair Darling continued to reject it.

Leighton’s idea is that the workers receive ‘phantom shares’ that act like normal shares, but have no ownership rights over the company. This would increase the workers’ perception of their saving and investment stake in the company and allow them to benefit from increases in value.

Darling said: “The discussions are at a fairly advanced stage. We have decided not to go down the road of an employee share ownership scheme, but we want a scheme that will bring equivalent benefit.

“Given the scale of the challenges in front of Royal Mail, it is only right that there should be some reward for employees.”

At the same time, a Royal Mail spokesperson said that a new scheme being agreed with the Government would still be worth £5,000 per worker and would represent a good UK investment for the country.

But Darling had some deep reservations about Royal Mail. “The Royal Mail has got to make some pretty fundamental changes to the way it works,” he said.




Tag Box




Financial fitness

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Which ISA is right for you? A round up of the six products available in 2017

From cash to innovative finance to lifetime, here's our guide to the ISA products available to savers this yea...

Guide to buy-to-let tax changes

In late 2015, former Chancellor George Osborne announced a range of  tax measures aimed at landlords, which t...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Five fund tips for a 0.25% interest rate environment

With interest rates stuck at a record low 0.25% and expectations rates could fall to close to zero, here are ...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Investing your money

Alliance Trust Plc gives you smart insight into how to invest your money

Money Tips of the Week

Read previous post:
First-time buyers ‘risking a lot’ to get on ladder

First-time homebuyers struggling to get on to the property ladder are becoming increasingly prepared to take financial risks, according to...