Monday, February 10, 2014

Privatision is a scam

Who'd have thunk it? The UK government's privatisation of Royal Mail turns out to have been a massive wealth-transfer to the rich, thanks to a bargain basement price:

Vince Cable is facing further accusations of selling Royal Mail "on the cheap" after it emerged that 21 City banks estimated its sale could have been done for £1.5 billion more.

The Business Department revealed in response to a Freedom of Information request that the average valuation for Royal Mail by the 21 investment banks was between £4 billion and £4.8 billion, significantly above the £3.3 billion price tag decided upon by ministers when floating 60% of the business on the stock market in October.

After Royal Mail's stock market entry at 330p in October, the business' shares made the biggest one-day gain of any privatised company. Last night they closed at 585p, with the share price at £6 billion.

When this happens in the third world, we call it what it is: fraud and corruption, an elite pillaging the state for its own profit. The people who presided over this massive theft of public assets should be going to jail. This being the UK, they'll probably be getting peerages instead.