Saturday, June 25, 2011

Time to end the fiasco called Canada Post?

The days of Canada Post’s monopoly over letter mail are numbered. The Canada Post Act makes it an offence for anyone but Canada Post to engage in letter delivery for less than three times the post office’s rate—you can even go to jail if you’re caught doing it. But indications are that national postal services are losing their traditional monopolies, and Canada Post will probably lose its monopoly by the end of this decade.

MPs locked in the showdown debated through the night Thursday, all day Friday and were heading for more into the weekend, with the NDP offering speaker after speaker on a procedural motion ahead of actual debate on Bill C-6. The marathon session could now stretch into next week, unless negotiations start getting more serious.

– The Globe and Mail
Jun. 25, 2011

Postal service in Canada has been in steady decline since I came to this country more than 50 years ago—prices have soared and service levels have plummeted. Next-day delivery and two deliveries a day were standards then, but Canada Post can now take up to four business days to deliver mail and still consider it “on-time.” Additionally, stamp prices have gone through the roof—from 1981 when one cost 17 cents to an expected 65 cents per letter in 2014—and home delivery, which has already disappeared altogether for many, will soon be only a fond memory.

As an important national service, Canada Post has been an unmitigated failure. Causes of its failure are many, including poor management and militant, incorrigible labour unions. But also of significance is the fact that, although it costs less to deliver mail in cities than in rural areas, Canada Post is required to deliver letter-mail across the country for the same price per letter regardless of real cost, location, distance travelled, etc., ensuring a system by which urban residents subsidize rural residents. 

Traditionally, there have been widespread political support for this monopoly, just as there was in the United States and Europe. One argument has been that if letter-mail were opened up to competition, private companies would only compete in the urban centres where there is a greater opportunity for profit, while rural areas would continue to be served by the post office, which would have to increase its prices or seek government subsidies.

As a consequence of its unreliable and expensive service, former post office customers have found alternatives to “snail mail,” many of which were made possible and practical by new technologies. So, in the past five years, Canada Post has suffered a 17 per cent decline in volume. There are millions of customers, though, who depend on the post office for orders, invoices, cheques and correspondence. For many like those with small businesses, the elderly, rural residents and non-profits the post office remains their only choice. They too need an alternative to Canada Post and its intransigent union workers.

Fortunately for them, there are encouraging signs of change reaching us from abroad. In recent years, national postal services in Germany, the Netherlands and Sweden have been privatized, and prices there are falling while service is improving. The United Kingdom’s government announced last October that it was taking steps to privatize its national postal service, and other European countries including Belgium and Denmark have either already privatized theirs or are in the process of doing so. As well, Japan’s postal service was completely privatized in 2007

So other democracies are proving there are attractive alternatives to our outdated monopoly.

I’m not sure how rural residents of these European countries fare under their competitive system, and, frankly, I really don’t much care. What is so bad for rural residents to pay more for postal service? Prices of many services are dependent on distance. Take, for example, phone calls, taxis, or train and airline tickets.

As Andrew Coyne said recently in a piece in Maclean’s:

“… by what principle of social justice are city residents, rich or poor, obliged to subsidize the correspondence of gentleman farmers? If governments want to redistribute income, let them do so directly, out of general revenues.”

It is time for Canada to catch up to a changing, modernizing world.



© Russell G. Campbell, 2011.
All rights reserved.
The views I express on this blog are my own and do not necessarily represent the views or positions of political parties, institutions or organizations with which I am associated.


  1. I give credit to the NDP for their consistency in flogging the deadhorse of state monopolies and socialist pablum. The NDP have not demonstrated any success in securing a mandate in 50 years, why expect them to change?

  2. Unfortuantely Jack and his little band of filabusters are prolonging the agony of "regular, working Canadians". Too bad Jack is oblivious to the lack of votes in supporting this strike nonsense. Out of touch and out of ideas. The demise of Canada Post has been overdue for decades. Cheers.

  3. Andrew Coyne should leave the pavement, periodically. 90% of the Canadian population (including most urban centres), lives within 100 miles of the U.S. border.
    Many "gentleman farmers" who raise crops, manage ranches and contribute to our economy, already drive many miles to pick their mail up. Does he think Canada Post delivers to just anywhere?

  4. With the preceding discussion regarding same prices for urban and rural mail delivery, let me remind you that Canada is the leader in socialist programs: take 'universal health care' for example, delivered by yet another high cost public service monopoly.

    No wonder we have Canada Post.

    If the NDP ever becomes the government, how long before we have 'universal' prescription drug care, toddler care, travel care, salary care, house care, everything care?

    Oops, almost forgot 'universal' government television care - the private sector chocking CBC.

    Yes, it's time to throttle down Canada Posts's monopoly on mail service. Simply another big waste of taxpayer's money, and an undeserved gift to the public sector unions.

  5. There are no couriers here, and I'm not very far from Vancouver. There is only Canada Post. If I had to drive 100 miles (and back again) to buy normal little items like electronic parts or other little whatnots, then it would be a death sentence. I would have to move into a large city along with everybody else who lives in rural areas. Is that the plan? Are you talking about a land grab? Do you want us to leave the rural areas? Canada Post isn't perfect, but it is a life line.