The Government is pressing ahead with its controversial plans to part-privatise the Royal Mail in the face of opposition from Labour MPs and unions, pledging to use money from the sell-off to modernise the business.
Ministers said moves to attract a "strategic partner" would help to deliver a "transformed" Royal Mail as the Government responded to criticism from a committee of MPs.
The business select committee voiced concern about the Government's plans, arguing that the case for selling off a stake in the business had not been made.
But Postal Services Minister Pat McFadden said the Royal Mail faced a "stark choice" about its future - to modernise or decline.
"The measures the Government proposes can deliver our objectives, which are to put a publicly-owned Royal Mail on a clear path to modernisation and, in so doing, to secure the future of the universal postal service.
"Royal Mail faces a stark choice about its future, to modernise or decline as mail volumes drop because of the shift to email and text messaging. The Government has put forward proposals that offer Royal Mail the opportunity to survive in this new communications age, as well as respond to its customers' changing needs."
The Government said the committee supported the majority of the proposals, including that the status quo was not an option, recognition that Royal Mail Group was significantly less efficient than its competitors and the need for both management and unions to change.
The Government rejected the committee's view that it should put a precise figure on modernisation.
Speculation is that the Government is planning to sell off at least a third of the Royal Mail businesses.
The Postal Services Bill will be debated in the Lords before its third and final reading on May 20. It will then be debated by the Commons.
