Fear for jobs in Consignia deal

THERE were fears for hundreds of Post Office jobs as parent company Consignia said its office maintenance division is to be hived off into a £1bn joint venture with Balfour Beatty.

Consignia announced that Balfour Beatty, the construction group which is set to be a main beneficiary of Tube part-privatisation, had been selected as preferred bidder to run Romec, the business responsible for the upkeep of 3000 post office administration sites and Royal Mail sorting offices and including the maintenance of 500 main post offices.

The business employs 5000 people - ranging from IT engineers to cleaners - but alarm bells were ringing among workers today when they were told Consignia is looking for £60m a year in cost savings as a result of the joint venture, in which it will have a 51% stake.

Workers threatened to strike when proposals to hive off Romec first emerged 18 months ago. The CWU union referred to the plan as part of a 'car boot sale' of Post Office assets.

Romec, which derives about 10% of its turnover of £150m a year from work for the likes of Standard Life and Marks & Spencer, is to be merged into Balfour's Haden Building Management - the Consignia contract to run initially for seven years.

MEANWHILE, Consignia has called for a 1p increase in the price of first and second class stamps to fund investment for a renewal plan.

A further price rise might be necessary if competition was introduced at the rate being proposed by the industry's regulator Postcom, it added.

Consignia said that the cost of posting packets and parcels and using the special delivery service would increase from 4 July. The price of posting a small packet would increase by 6p to £1.30, a parcel up to a kilogram in weight would rise by 5p to £3.15.