MAKING LIFE EASY FOR CANADA POST

THE FOCUS IS NEVER ON HOW TO IMPROVE MAIL SERVICE FOR CANADIANS

The job of a post office, one might reasonably suppose, is to deliver the mail. That was surely somewhere in the vicinity of what those who established it had in mind, or they wouldn’t have put “post” in the name. The 1981 Canada Post Corporation Act sets out as its primary objective “to establish and operate a postal service.”

And yet, although it now charges a minimum 85 cents per letter — five times as much as in 1981 — and maintains about 64,000 employees on its payroll, the post office seems increasingly unwilling to do the job for which it was established, the job that it alone is allowed to do: deliver the mail.

This is not new. The decline has been going on for decades. Saturday delivery was the first to go. The overnight delivery standard was next: as of 1986, two days within the same city was acceptable. Over much of the country, in the years that followed, home delivery was eliminated in favour of community mail- boxes. In effect, much of the public now deliver the mail to themselves.

You would think, then, that it would be a matter of some urgency to the post office’s political masters to somehow cajole it into doing the job we pay it to do. Yet whenever Canada Post comes in for one of its periodic public reviews, the focus is always the same: not, how can we improve mail service for Canadians, but how can we make life easier for Canada Post?

The latest report, from a panel headed by former broadcasting executive Françoise Bertrand, is no different. Thought it comes with the usual rah-rah about “transformational change” and “hard choices,” the options it presents amount to doing less, charging more or both. If Canada Post won’t deliver the mail, officialdom’s answer is that no one should get it — or that they should get it on alternate days, or should pay an extra annual home delivery fee, or should bloody well go and get it themselves.

Never having known any alternative to Canada Post — unable even to imagine an alternative — we are too prone to accept this logic. To be sure, Canada Post’s finances are in a dire state, notably its $8-billion pension deficit. Given the costs of restoring home delivery — another $1.2 billion annually, according to the panel — it sounds hard-headed and businesslike to say it has to go. Two-thirds of the country already uses community mailboxes; why shouldn’t the other third have to suffer the same fate?

But this has the issue back to front. The point is not to make the level of service contingent on Canada Post’s finances, nor is it the job of the post office’s customers to serve the needs of Canada Post. If Canada Post finds it too hard or tiresome or costly to deliver the mail, the only sensible response is to let someone else do it. Between the false alternatives of shutting down service or handing the keys to the treasury to the postal workers, there is a third: open the mail to competition, as many other countries have done.

This may puzzle some readers. Isn’t there already competition? What are all those private courier companies about? But the competition in this case is between two different sorts of business. By law (Section 14 of the Canada Post Corporation Act) Canada Post possesses the “exclusive privilege” to carry letter mail. Competitors are permitted to carry letters of “an urgent nature” — but not for less than three times the price of a stamp.

This never made much sense, and makes even less sense now. If people are willing to pay someone else to deliver the mail that Canada Post won’t, why should they be prevented from doing so? Why on Earth are we still protecting Canada Post’s monopoly on a service it refuses to provide?

The answer that always comes back is: because it is necessary to preserve the tradition of universal service, that is at a uniform rate of postage. Without it, lower-cost competitors would “cream off ” hightraffic urban routes, where the price of a stamp far exceeds costs, leaving Canada Post to serve high-cost rural routes.

There are a number of problems with this argument, and not just the obvious one: that Canada Post is not serving rural routes now. But note how perfectly circular it is. Why should Canada Post have a monopoly? To preserve the uniform postage rate, and the elaborate system of cross-subsidization it supports. And why should it be obliged to charge a uniform rate? Because it’s a monopoly.

Take away the assumption of uniform postage, and the argument falls. Let the price of postage reflect the costs of delivering to out of the way spots, and private carriers would have every incentive to do so. Why, indeed, would we want to charge the same rate for every letter, no matter its cost? We don’t do the same for every phone call, or every plane trip; neither is the price of, say, a house expected to be the same in every part of Canada. But once it is realized that uniform postage is the linchpin propping up an obsolete monopoly, the price must surely be too high.

It is interesting to note, in this regard, the one truly subversive option in the Bertrand task force’s report: a proposal to let the price of a stamp vary with the cost of delivery, abolishing the uniform postage rate. Do that, and the monopoly is doomed.