In a recent bid to stem the tide of lost revenue, Canada Post has announced that it would trim as many as 8,000 jobs as it moves toward automated delivery. Meanwhile the cost of an individual stamp is going up to $1.
Removing door-to-door delivery of regular mail is part of the plan to trim what have been regular losses over the past few years. Over the next five years the third of Canadian households that receive their mail at their door will be converted to community mailbox delivery.
Starting March 31, 2014, the cost of a stamp if purchased in a pack will increase from $0.63 to $0.85. Stamps purchased individually will jump to $1.
“With the increasing use of digital communication and the historic decline of letter mail volumes, Canada Post has begun to post significant financial losses,” the Crown corporation said in a news release. “If left unchecked, continued losses would soon jeopardize its financial self-sufficiency and become a significant burden on taxpayers and customers.”
The first communities that will switch to community mailboxes will be revealed later in 2014, according to the release.
Back in September 2013, Minister of Transport Lisa Raitt advised that removing door-to-door service was advisable, given that Canada Post experienced $104 million in losses through the second quarter. This is a repeat of trends established last year when losses of $102 million in the second quarter were reported.
Canada Post said that recent losses are a continuation of a downward trend over the last several years as society moves ever increasingly toward a digital economy. Raitt went on to say in the release that “The government of Canada supports Canada Post in its efforts to fulfill its mandate of operating on a self-sustaining financial basis in order to protect taxpayers, while modernizing its business and aligning postal services with the choices of Canadians.”
Liberal Leader Justin Trudeau slammed the timing of the announcement. “This is a government trying to minimize what they know is bad news,” Trudeau said. “As they announced it, Stephen Harper is offering less postal services for more money from consumers in the coming years.”
If current trends continue unabated, Canada Post could face a $1-billion deficit by 2020.
SIDEBAR
The breakdown from Canada Post:
- 5,094,694 people presently get door-to-door delivery in Canada.
- Average annual cost per address is $269.
- 3,804,574 receive mail through group mailboxes.
- Average annual cost per box is $117.
