Royal Mail is entering a crucial phase in its 345-year history. The next few months will see its regulator decide how much it will be able to charge for stamps until 2010, the publication of the Bain report into its future and the advent of full competition for postal services in January 2006.

Small wonder, then, that there is a sudden clamour about the company's £4.5bn pension fund deficit. Royal Mail knows this is one of its strongest cards in arguing for lighter price controls. Allan Leighton, its chairman, also knows that the deficit could scupper his plan to make Royal Mail a partly employee-owned business.