Report hints about the future of Canada Post
What is to be done with the post office? A government task force report released this week doesn’t exactly answer the question.
But it does provide some hints as to where Justin Trudeau’s federal Liberal government may go. Door-to-door mail delivery. During last year’s election campaign, the Liberals promised to stop Canada Post from replacing urban home delivery with widely unpopular community mail boxes.
Critics said that ending home delivery would particularly disadvantage the elderly and those who find it hard to get around.
Some municipal politicians said there simply isn’t enough room in dense urban areas to set up community mailboxes.
Opposition was especially fierce in Trudeau’s home city of Montreal.
In its 94-page discussion paper, the four-member task force notes, without comment, that permanently cashiering the conversion to community mail boxes would cost Canada Post $320 million a year.
Fully restoring home mail delivery for those who have already been moved to community mail boxes, it says, would cost the Crown corporation $1.2 billion annually.
To put that figure into perspective, it notes that individual stamp prices would have to go from $1 to $1.50 to cover this cost. Or, conversely, each household receiving door-to-door delivery could be charged $124 annually for the privilege.
My guess is that the government won’t want to go anywhere near these extra levies, particularly given the fact that polling commissioned by the task force found that 69 per cent of Canadians think the conversion to community mail boxes should continue apace.
What can the Liberals do to square all of this with their campaign promise to “save home delivery?”
The task force report provides one hint. It notes that continuing home delivery for those in particularly dense urban areas as well as for those suffering mobility problems would cost Canada Post a mere $50 million annually.
In short, door-to-door mail delivery could be saved — but just not for everybody who has lost it. New ventures. One of the ways Canada Post could continue delivering the mail without losing money is by getting into new lines of business.
The Canadian Union of Postal Workers has argued long and hard that Canada, like France, the United Kingdom and New Zealand, should set up postal savings banks.
In those countries, the profits made in banking help cover the cost of postal services.
Japan’s postal savings bank was so profitable that the government privatized it.
Alas for CUPW, this particular task force doesn’t think much of postal banking. Echoing Canada Post management, the report says the country already has a sophisticated and widespread financial system and there is not much room for a newcomer to break in.
But the figure that will mean most for politicians studying this file comes from the task force’s polling. It found that 60 per cent of those surveyed thought poorly of postal savings banks.
More to the point, only 7 per cent of those surveyed said they would make use of such banks.
It’s possible that the Liberal-dominated Commons committee charged with making recommendations to the government later this year will have a radically different take on postal banking.
But it’s unlikely.
One of the more unexpected suggestions from the task force is that the government set up a new regulatory body to oversee the post office — and competing couriers
Marijuana. The task force says once marijuana is legalized, the post office could get into the business of delivering the drug through its parcel service. But as the Star reported, it expects such a move would net Canada Post $20 million a year at most. Postal regulator. One of the more puzzling and unexpected suggestions from the task force is that the government set up a new regulatory body to oversee the post office — and competing couriers. This regulator, the report says, could eventually levy fees on private couriers to subsidize Canada Post losses.
More to the point, the regulator would insulate the government from politically tricky issues, such as closing rural post offices and raising stamp prices.
Its job would be to “manage the ongoing decline of Canada’s postal service” in a way that balanced the public interest with what the task force calls competitive realities.
I’m not sure what the politicians will make of this suggestion.