A Canada Post Truck in the GTA. (Photo by Raysonho @ Open Grid Scheduler / Grid Engine. Public Domain.)
Major changes are on the horizon for Canada Post, which has been deemed “insolvent” and is currently losing approximately $10 million per day, Ottawa says.
The federal government is directing Canada Post to transition from door-to-door delivery to community mailboxes for four million additional addresses, Minister of Government Transformation, Public Works and Procurement Joël Lightbound said during a Sept. 25 press conference.
The Crown agency is also being asked to restructure rural deliveries and shift non-urgent mail from air to ground, Lightbound said.
“Canada Post is facing an existential crisis. We need to respond,” he said. “I know that Canadians care about the future of Canada Post.”
The agency is on track to lose $1.5 billion in 2025. It announced a pre-tax loss of $407 million for the second quarter of this year in an August statement. It said the loss was driven largely by a sharp decline in parcel revenues.
Ottawa plans to address the loss by adopting all recommendations issued by the Industrial Inquiry Commission led by William Kaplan in a May 15 report, which reviewed Canada Post’s financial crisis and made recommendations to improve its fiscal situation, Lightbound said.
In addition to using community mailboxes for four million additional addresses, along with developing dynamic routes to adjust to daily fluctuations in mail volume, a simpler process for stamp rate increases will be established, Lightbound said.
The changes are expected to generate nearly half a billion dollars in annual savings, helping ensure Canada Post’s long-term survival, the minister said.
The Canadian Union of Postal Workers has previously said it opposes many of Kaplan’s recommendations.
“Commissioner Kaplan’s report of the Industrial Inquiry Commission skews heavily in favour of Canada Post’s positions and recommendations,” the union wrote in a May 16 statement. “We fundamentally disagree with the bulk of its recommendations and challenge some of the information on which it was based.”
Labour negotiations between CUPW and Canada Post remain stalled. The union has rejected the government’s offer of a 13 percent wage increase and instead demanded 19 percent. Talks have stalled over issues including weekend delivery, part-time roles, and flyer distribution.