Canada Post is projected to face a $1.5 billion loss in 2025, prompting the federal government to launch a modernization initiative aimed at stabilizing the corporation’s finances. As negotiations between the union and Canada Post have hit a roadblock, the government’s plan includes transitioning the remaining four million addresses still receiving home delivery to community mailboxes.
According to a government official, three-quarters of Canadians already utilize community mailboxes, and shifting the remaining addresses to this system is estimated to save Canada Post $400 million annually. Additionally, Canada Post will optimize its mail delivery methods by transitioning non-urgent mail from air to ground transport, resulting in a $20 million yearly cost reduction.
The government is also lifting the 1994 moratorium on closing rural post offices, affecting nearly 4,000 locations that were once rural but have since transitioned to urban areas. Stamp price adjustments are under review to enhance flexibility and efficiency in the pricing process.
Despite the potential phase-out of home deliveries, the delivery accommodation program for individuals with mobility challenges will continue. Minister Joël Lightbound emphasized the urgent need for transformation to ensure Canada Post’s survival, citing accumulated losses exceeding $5 billion since 2018.
The government’s recommendations align with the Industrial Inquiry Commission led by William Kaplan, which highlighted the decline in letter mail volume over the years. Kaplan’s report emphasized the necessity for adaptation due to the irreversible trend of declining mail volumes globally.
Amid an ongoing labor dispute, negotiations for a new collective agreement have faced challenges, with the union seeking a 19% pay increase, higher than the government’s 13% offer. In response to the impasse, the Canada Union of Postal Workers (CUPW) has altered its job action strategy to include a refusal to deliver flyers, citing inadequate compensation for this task.
Canada Post has urged the union to resume flyer deliveries stuck in the network in preparation for renewed talks. With pressure mounting to reach a resolution before the holiday season, the parties are working towards a mutually beneficial agreement to avoid disruptions similar to the strike and lockout experienced last year.
The government has given Canada Post 45 days to assess the proposed changes and outline the implementation strategy. Transformation is crucial to address the corporation’s financial challenges and uphold essential mail services for Canadians.
