Jill Treanor for The Guardian: “The Royal Mail privatisation will be the subject of fresh scrutiny by MPs next week when bankers from Goldman Sachs and UBS – which handled the sell-off of the 500-year-old institution – are summoned to give evidence to a high-profile parliamentary committee.
The public accounts committee, chaired by Margaret Hodge, who has previously conducted tough evidence sessions on corporate tax, will also hear from top City regulators and senior executives at Royal Mail at sessions next week.
Her committee, which convened the Royal Mail hearings in the wake of the National Audit Office’s damning verdict on the privatisation, is expected to scrutinise how 16 City firms were allowed priority access to the shares.
The shares were sold at 330p on 11 October, when they jumped 38% immediately, sparking a furore about whether a prime state-owned asset had been sold off on the cheap. The shares closed last night at 532p, still well above the initial offering price but off highs of more than 600p.
On Monday 28 April, Martin Wheatley, the boss of the Financial Conduct Authority – which is under fire for the way it announced a review of the savings industry last month – and his senior official William Amos, who is responsible for the fund management industry, are to face questioning.
On 30 April, James Robertson from UBS and Richard Cormack of Goldman Sachs, the two firms involved in conducting the sell-off, will give evidence alongside representatives from Lazard, the investment bank which acted as adviser to the Department for Business, Innovation and Skills and was paid £1.5m for doing so.
William Rucker, the chief executive of Lazard in the UK, will appear alongside one of the firm’s fund managers, Alan Custis.
Martin Donnelly, the most senior civil servant in BIS, is scheduled to give evidence the same day, as will Mark Russell, the chief executive of the Shareholder Executive, which looks after government stakes in businesses.
The public accounts committee will hold its sessions in addition to those being held by the business committee which has recalled Vince Cable, the business secretary, and his minister Michael Fallon. Their appearances are scheduled for Tuesday.
When he recalled Cable this month, Adrian Bailey, the Labour MP who chairs the business committee, called for the business secretary to resign after the publication of the National Audit Office report.
The report found that the government had cost taxpayers £750m in a single day by undervaluing the postal service, which previous governments had slated for privatisation but did not carry out.
Cable has defended the sell-off, insisting that fund managers would not pay more for the stock while Hodge has previously said that his department made a mistake “by incentivising its private advisers to sell the shares on time at the expense of price”.
The audit office found that Lazard was paid on the basis of completing the sell-off, not on achieving the highest price possible.
• This article was amended on 24 April 2014. The earlier version said “The shares closed last night at 532p, still well below the initial offering price”.” (http://www.theguardian.com/uk-news/2014/apr/23/royal-mail-mps-bankers-sell-off-privatisation)