ePolitix.com reports on the latest Commons business and enterprise committee evidence session on the UK postal services sector.
The government has been attacked over plans that critics say would nationalise the Royal Mail's debts and privatise their profits.
Union bosses made the claims ove controversial government proposals to allow a private company to take a stake in Royal Mail.
Leaders of the Communication Workers Union (CWU) called on business secretary Lord Mandelson to "think again" before going ahead with part-privatisation of the company.
CWU general secretary Billy Hayes claimed that the Royal Mail did not need privatisation but just proper investment to deliver better efficiency.
Hayes made the comments during an evidence session to the Commons business and enterprise committee on the UK postal services sector.
He urged Labour to stand by their manifesto commitment to deliver a successful publicly-owned postal service.
In recent weeks, the media has reported that the Dutch-owned postal firm TNT was interested in taking a stake of between 25 per cent and 33 per cent in Royal Mail.
But Hayes speculated that the share could be as high as 49 per cent, which was of concern to the CWU union.
Following an independent review into the postal service last year, the government indicated that it would be taking over Royal Mail's billion pound pensions deficit.
Hayes argued that this might allow the Royal Mail to go ahead with investment without the need of support from the private sector.
He also expressed concern that the Royal Mail was reluctant to divulge how much money it would require for modernisation.
He stated: "It's like playing charades - trying to guess what future investment is needed for the company.
"If a private company comes in they will want to make a profit. My fear is that we would be nationalising the debt and privatising the profit.
"Isn't it about time the secretary of state said how much money the Royal Mail needed. I have not seen one convincing argument for privatising the Royal Mail," he added.
Committee member Lindsay Hoyle (Lab, Chorley) fell into a disagreement with witness Richard Hooper, the author of last year's report into the postal service.
Hoyle disagreed with Hooper's support for part-privatisation of the Royal Mail.
He stated: "I think you are driven by dogma. You don't like the Royal Mail - you want to see it broken up. You are giving taxpayers' money away to a competitor. It is not good enough and I don't accept your report."
But Hooper claimed that by bringing in a 'strategic partner' with "transforming" experience to the Royal Mail, they could modernise and improve efficiency.
He declined to make a statement on how much of a share the private investor should have in the postal service, claiming that was a negotiation for government.
But Anne Moffat (Lab, East Lothian) expressed her concern that MPs would have "real problems" selling part privatisation to their electorate.
Lembit Opik (Lib Dem, Montgomeryshire) questioned the witnesses on the costings of the Royal Mail and the lack of transparency over its finances.
The report has called for a move from the regulator Postcomm to Ofcom.
Hooper, chairman of the Postal Services Sector Review Panel, explained that there has not always been "the best relationship" between the regulator and the regulated party.
He added that there has been "quite a lot of dispute about costs", which must be overcome.
Hooper noted that the access price is of "great concern" to union members, in terms of the way Royal Mail is regulated.
"I personally would think that we should move to a situation where the regulator sets the access price," Hooper said.
If regulation moves from Postcomm to Ofcom, they are likely to set the access price.
But Hooper explained that the move had "a sting in the tail".
If the delivery arm of the Royal Mail is modernised, the regulator will have a "squeeze" on it to ensure that efficiency is delivered, Hooper added.
Hoyle asked what was the lowest cost level that the Royal Mail could come down to, to ensure competition with private companies.
Hooper admitted that his inquiry did not have "very good cost figures" on that at the moment.
"Right now the main point about the Royal Mail is that it is relatively inefficient," he said.
He cited figures that showed that according to best practice in Europe, 85 per cent of postal sorting is done by a machine.
He claimed that the choice for Royal Mail now was to "modernise or decline".
Chairman of the committee Peter Luff (Con, Mid-Worcestershire) claimed that there appeared to be "no agreement at all" over cost regulation. He asked whether this was a failure of the Royal Mail or the regulator.
But Hooper refused to be drawn into what he termed "the blame game".
"The report is focused on what we should do today," he stated.
But he did admit: "The regulator has not achieved certain things in this regime."
He explained that because Postcomm was a small regulator, it does not have regulatory powers. But he claimed that Ofcom is knowledgeable about universal services obligations.
Hooper explained that his independent report was recommending that the pensions deficit should happen "in a staged approach, as modernisation is delivered by the management and the unions of the Royal Mail".
Hooper added that he was "absolutely confident" that the right strategic partner could be found to help modernise the Royal Mail.
Roger Berry (Lab, Kingswood) suggested that it was a "little optimistic" to expect the private sector to want to invest in the Royal Mail in the current financial climate.
Hooper replied that the "proof of the pudding will be in the eating".
"You may be right," he conceded. But the postal service is a big industry with a "significant future", he added.
Luff noted that major banks have seen large proportions of shares purchased by the government.
"I don't understand what strategic partnership is if it is not an owner," he told the witnesses.
Hooper responded: "I don't think we spelt that out in the report. An independent review to come down on this would have tied the hands of government during negotiations."
But he added: "It must involve ownership of some kind though."
Hooper also refused to be drawn on how much capital would be required to modernise the Royal Mail.
He claimed that he had seen a confidential document that outlined plans for their future but said it was not his role to make comments on the commercial side of the postal industry.
But he confirmed: "I believe that the Post Office Ltd should remain 100 per cent in public ownership."
CWU deputy leader Dave Ward claimed that Hooper's report confused "efficiency with profitability".
He argued that to make the Royal Mail more efficient was not complicated. He urged the postal service management to bring in machinery to make the process of mail sorting faster.
"What we keep asking Royal Mail is why they haven't brought these machines in already," Ward said.
"We have always supported automation."
Ward also questioned why between £600m and £1.2bn assigned for Royal Mail modernisation has not yet been spent.
He said that the union was "struggling" to understand how Hooper could criticise the Royal Mail for lack of transparency over their finances and yet make conclusions about the service without the facts.
Hoyle agreed that it was "absolutely barking".
On a change in regulator for the Royal Mail, Billy Hayes claimed that Postcomm had done "a lot of damage", while the union's experience of Ofcom had been generally positive.
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