Any suggestion of compulsory redundancies will lead to appropriate industrial action

John Keggie CWU

Consignia outlined plans to shed 15% of its workforce to the government on Tuesday evening.

But as the threat of a strike mounted throughout Wednesday, the firm begun to back-pedal furiously, stressing that the proposed cuts are still speculative.

Union leaders said they would hold a ballot for strike action unless the threat of compulsory job losses was removed.

The scale of the proposed cutbacks prompted immediate outrage among workers, unions and the British public, concerned over the quality of their postal service.

Compulsory or voluntary?

Consignia is struggling to cut costs after its previously profitable business plunged into the red during the last two years.

Consignia

Changed name from the Post Office in Mar 2001, when it became a state-owned limited company Comprises more than 20 companies worldwide including Royal Mail, Parcelforce and the Post Office branches Employees 200,000 Chief executive John Roberts, with the postal firm since 1967

Speaking to the House of Commons Trade & Industry Select Committee on Tuesday, Consignia's chief executive John Roberts was asked what the scale of job losses was likely to be.

"We haven't finalised numbers we are looking at if we produce the �1.2bn [savings]. We could be looking at anything up to 30,000 redundancies," he said.

But Mr Roberts stressed on Wednesday that no final decisions had been taken about possible job losses.

And he also pledged that, where possible, any redundancies would be either voluntary or by natural wastage.

The firm has a high labour turnover of about 20,000 people a year, but resigning staff will not necessarily match up geographically with where Consignia wants to cut back.

A generous pension fund arrangement for early retirements may also encourage voluntary redundancies.

The Communications Workers Union, which represents more than 90% of post office workers, described Mr Roberts' comments as a "tactical withdrawal" and said the threat of industrial action was still on.

The two parties will meet on Thursday to thrash out the issues involved.

'Horrendous Christmas'

Communication Workers' Union (CWU) deputy general secretary John Keggie said the number of losses was "completely unreasonable".

The threat of 30,000 redundancies is so horrendous on the eve of Christmas

Roger Lyons MSF Union

The number of job cuts was also criticised by Roger Lyons, the leader of the MSF Union which also represents postal workers.

He told the BBC: "The threat of 30,000 redundancies is so horrendous on the eve of Christmas that I have appealed to Consignia: 'Come back to the table. Let's get through Christmas without this cruel cut'."

These job cuts would come on top of a reduction of about 10,000 in the company's 200,000 workforce over the past year.

It's frightening. You don't know what's going to happen day to day. You don't know where they're going to make these cuts.

Reggie Alexander, post office worker

"It's frightening. You don't know what's going to happen day to day. You don't know where they're going to make these cuts," said Reggie Alexander, who has worked for the post office for nine years and who said he backed strike action.

In May, the postal service across much of the country was paralysed by a series of wildcat strikes by 6,000 workers over commercially-inspired changes to working practices.

Savings consensus

Peter Carr, the chairman of the postal industry watchdog Postwatch, said Consignia was in financial crisis and cutting jobs was the right thing to do.

It is inevitable in reducing costs that they have to attack the labour costs

Peter Carr Postwatch

"What one has to remember is that 70% of Consignia's costs are labour, therefore it is inevitable in reducing costs that they have to attack the labour costs," he told the BBC Radio's Today programme.

The company's increasing losses were attributed to the downturn in the economy and the costs and delays on the railways following the Hatfield rail crash.

And growth in total mail volumes is being hit by the increase in e-mails and text messaging, and the decline in junk mail due to less advertising.