Did we build our public post office for 200 customers?

That's what Canada Post thinks. Canada Post says that it has 200 large customers that make or break the corporation and that it needs to keep its eyes on the people who pay the bills.

So what about the rest of us? You know, the 33 million folks who make up this country. The people who built and paid for our public post office. Don't we matter?

Canada Post is quick to point out that we have an "emotional" or "historic" relationship to the post office that no longer makes sense. Senior managers note that, while people react "emotionally," they don't buy stamps. They argue that the post office no longer plays a role in the community. "It's not Wal-Mart," said Canada Post's president. "It's not their mall."

This is true. Our public post office is neither Wal-Mart nor a mall. It's a public institution that is mandated by law to provide basic customary postal service while improving service, operating on a financially self-sustaining basis and balancing the objectives of the corporation with the needs of its employees.

Unfortunately, it appears that Canada Post has a different understanding of its mandate. The corporation's president has repeatedly stated that Canada Post is a commercial enterprise with a business mandate.

The problem is that the government has asked the post office to act like a commercial enterprise. The government's financial and policy framework for Canada Post calls on the post office to provide a commercial rate of return and pay an annual dividend of 40 per cent of net profit.

This means millions of dollars that people pay in postage are directed towards providing Canada Post with commercial profits ($119 million in 2006) and the federal government with lucrative dividends ($80 million in 2006), instead of being used to maintain affordable rates and improve public postal service and jobs.

Now, we can either get used to this, or we can tell the federal government that the post office is ours and we want it back. We want Canada Post to start acting like a public institution, not Wal-Mart. Instead of paying a huge commercial dividend, we want the corporation to invest in keeping post offices open, maintaining rural delivery, expanding door-to-door service and reducing its horrific injury rate - one of the worst in the federal sector. And last but not least, we want the post office to use its profits to improve service for the public, not just for its 200 major customers.

Canada Post is 25 years old. A great deal has changed in the last quarter century. But has the post office really become a commercial enterprise? Canada Post's anniversary gives us an opportunity to discuss this and other issues. What is the future of our public post office? What does the post office need to do to meet the challenges it faces? Did we really build our public post office for 200 customers? Let's use Canada Post's 25th anniversary to say no, we didn't.

You can obtain a copy of Our Vision of the Post Office through the mail (377 Bank Street, Ottawa, Ontario K2P 1Y3), by phone (613-236-7230 ext. 7944) or by email (bklassen@cupw-sttp.org).

Deborah Bourque is the National President of the Canadian Union of Postal Workers. She represents 54,000 workers from coast to coast to coast. The majority of them work for Canada Post.

 

 

(SIDEBAR)

What the law says

What the government does

 

Canada Post Corporation Act -Canada Post has a mandate to provide public postal service. The CPC Act says that our public post office should provide basic customary postal service while having regard for "the need to conduct its operations on a self-sustaining financial basis." In addition to asking the corporation to break-even, it says the corporation may declare and pay a dividend if the corporation can and the government decides it wants a dividend. It also says that postage rates shall be fair, reasonable and sufficient to defray the costs incurred by the Corporation in the conduct of its operations under this Act.

But the Act doesn't require Canada Post to make profits or pay dividends.

Financial Administration Act -The FAA says "there is a reasonable expectation that the corporation [Crown corporations like Canada Post under Part II of Schedule III] will pay dividends" and "ordinarily earns a return on equity."

But there is nothing in the FAA that requires a commercial rate of profit or the kind of dividends that a business might be required to pay.

In spite of this, the federal government has asked Canada Post to act like a profit-driven commercial enterprise.

Government financial and policy framework for Canada Post-The government's financial and policy framework for Canada Post calls on the post office to provide a commercial rate of return (11% goal, reached 15 % in 2005) and pay an annual dividend of 40 per cent of net profit.

The government's commercial objectives for Canada Post are fundamentally at odds with the corporation's legislative mandate to provide public postal service and its public policy objectives, as a Crown corporation, to serve the public interest. While Crown corporations like Canada Post have both public and commercial activities, they are distinct from commercial enterprises in that they are designed to serve the public interest, not maximize profit.