There is, though, one obvious way out for Brown. There’s no date yet for the legislation to come before the House but most observers expect it to do so after June 4th. In other words, after the European and local elections and the expected reshuffle. If Brown moved Mandelson to the Foreign Office, the job he has always wanted and the most senior government job he could realistically do from the Lords, then his successor could accept a compromise.
One other fascinating thing to watch on the Post Office front is how clear Alan Johnson makes his position. As a former postman and head of the CWU, one would expect him to have strong opinions on the issue.