The 2007 postal strike did not come out of the blue; it came in response to the Labour government’s ten-year drive to privatise the post and public services in general. This is part of an international trend called neoliberalism, the extension of free market policies and opening new markets and industries to the profits of multinational companies, in the context of intense competition and pressure on profits.

The 1996 national postal strike decisively saw off attempts to privatise Royal Mail by the weak Major government and in the process gave the Tories a final blow. Blair’s free-market government came in and immediately began to “reform” public services, pushing for a EU directive laying out a timetable for opening up every country’s postal market by 2009. A steady march of changes drove Royal Mail towards the free market: The 2000 Postal Services Act which set up the quango Postcomm to “regulate” the postal sector and lever it open to market forces, Royal Mail’s switch to PLC status (2001), the hiring of Allan Leighton as Chairman (2002) and Chief Executive Adam Crozier to get Royal Mail ready for competition, as one of the last "really big corporate turnarounds in the country" as Crozier put it.

Both were chosen for their record for restructuring, from the Football Association (Crozier) to Leeds United and ASDA (Leighton), and for their commitment to privatisation. With the help of the CWU leadership, they pushed through the shift to Single Daily Delivery in 2004 which unleashed a temporary boost in profits, with up to 45,000 jobs lost. The majority of the board at RM are in favour of an employee share scheme as was Alan Johnson, DTI Secretary under Labour in 2005-6. Leighton openly campaigned throughout 2006 for these shares to be sellable to non-employees, in other words for privatisation.

British capitalism is clearly committed to restructuring the post, both to lower costs – for instance, a recent study of privatisation in Britain showed that the privatisation of British Gas lowered bills for big business by 31%, compared to 3% for consumers - and to create new specialised products and a service tailored to suit business, while reducing the service for the public with post office closures, stamp price hikes and later deliveries.

It is another example of turning public services into markets or opening them up to private investors – companies, consultancies, charities - as a new source of profit at the expense of workers and users, just as Labour is doing in the NHS, education with privately owned academies, and outsourcing and sell-offs in the government departments. The aim is to decrease state funding so big business tax can be cut, to hold down wages, slash jobs, hike up the workload and raise the level of exploitation in these services and release a profit that can be handed over to big business. The ultimate goal of the bosses is privatisation, and hopefully a strong British multinational that can compete in the European market and on the world stage like Stagecoach or British Petroleum.

However these economic questions are of course questions of class struggle too, since in the case of Royal Mail, successful restructuring can only be done by slashing jobs, massively hiking the workload, and cutting the CWU down to size. The CWU is a key target for Labour and the British capitalists, as it is a relatively strong union, one that still contains reservoirs of shopfloor organisation and militancy as the recent walkouts in London, Glasgow, and Liverpool showed. The defeat of the CWU would be weaken all public sector unions and make a united strike response to the sweeping privatisation that much less likely. It would help open the floodgates wider.