5,000 more face axe at Consignia

CONSIGNIA, formerly the Post Office, plans thousands more redundancies this year, on top of the 30,000 job losses already planned.

Sources close to Consignia, which is losing £1.5m a day, believe that at least another 5,000 jobs will go as the company battles for survival. The job cuts will come from reorganised urban post offices and the parcels business.

Consignia chairman Allan Leighton is understood to believe that job cuts will have to bite even deeper than the 30,000 already hinted at. A spokeswoman said: 'There will be more redundancies and they will come on top of the job losses we will be announcing in a few weeks time.' She declined to say how many jobs would go in the Post Office and parcels businesses.

News that Consignia is being forced to take even tougher action to stem losses comes as it agrees a two-year, 6.8% pay deal with its staff, ending the threat of a national postal strike.

But the redundancy announcement is expected to be complicated by tensions between Consignia management and the Department of Trade and Industry. There is a growing feeling that the Government is reluctant to see an announcement of huge job cuts and is trying to manage the release of news.

Details of the job cuts have been known to top management for nearly two months, but the DTI, headed by Patricia Hewitt, is understood to have been holding up the announcement.

Though it believes it has given Consignia commercial freedom, the Government owns 100% of it and takes a close interest in its running. A senior source at Consignia said: 'It is impossible to do anything fast around here. The Government constantly interferes.'