Citing “unsustainable” losses, stalled contract talks and dwindling numbers of Canadians sending letters, the federal government is giving Canada Post the green light to end home delivery, close some rural post offices, and send mail by land instead of air.
In a press conference Thursday afternoon, federal minister聽for government transformation, public works and procurement聽Jo毛l Lightbound announced that he’s giving the Crown corporation 45 days to come up with a plan to implement the broad restructuring, which he called a necessary step to keep Canada Post alive.
“Canada Post is now facing an existential crisis,” said Lightbound, adding that the Crown corporation has racked up more than $5 billion in losses since 2018, and is on track to lose $1.5 billion in 2025.
“Canadians can鈥檛 be footing an ever-growing bill year after year,” said Lightbound. “We can鈥檛 go on with Canada Post losing $10 million a day, and Canadian taxpayers footing the bill.鈥
Lightbound said people with mobility issues, including seniors, can apply to still receive home delivery, under a program that’s already in place in areas currently served by community mailboxes.
Neither Canada Post nor the Canadian Union of Postal Workers immediately responded to requests for comment.
The changes mean a large number of CUPW’s 53,000 members will almost certainly lose their jobs, said McMaster University labour studies professor Stephanie Ross.
鈥淲hat these announcements will mean is a significantly smaller workforce at Canada Post,” said Ross. “They鈥檙e inherently going to reduce the letter carrier workforce.鈥
That could tempt the union to start another full-blown strike, Ross said.
“There aren鈥檛 many other cards to play,” said Ross.
Brock University labour studies professor Larry Savage called the decision to order the changes during a contract dispute “a fundamental attack on workers’ rights.”
“The Liberals are handing management at Canada Post a battering ram to beat the union into submission,” said Savage.
Lightbound defended the timing, saying that Canada Post’s deteriorating financial situation made the changes urgent.
“The conflict has been going on for 20 months. I don’t have the luxury of waiting.”聽
Letter and parcel volumes have also plunged, Lightbound said, noting Canada Post delivers an average of two billion letters a year, down from 5.5 billion 20 years ago.
At the same time, he noted, the number of households served by Canada Post has increased.聽The Crown corporation’s share of the parcel market has also dropped to 24 per cent, from 62 per cent in 2019, he added.
“That means fewer letters are being delivered to more addresses, while fixed costs remain high,” said Lightbound.
Only a quarter of Canadians get home delivery with the rest using community mail boxes.
The conversion of the remaining home delivery customers will take place over the next nine years, with “the bulk” coming over the next three to four years, the minister said.
Closing some of the 4,000 post offices currently designated as rural could lead to $400 million in savings, said Lightbound, who argued that many of those offices are no longer actually in rural areas, pointing to areas like Richmond Hill, Burnaby, B.C. and Gatineau, Que.
A ban on closing post offices has been in place since 1994.
“Canada has changed. This means that areas that used to be rural may now be suburban or even urban, but are still required to operate as rural post offices,” said Lightbound. “Canada Post must return to the government with a plan to modernize and rightsize its network.”
The changes were all recommended by veteran mediator William Kaplan in a report delivered May 15 after he conducted an Industrial Inquiry Commission.
Contract negotiations between Canada Post and the Canadian Union of Postal Workers have聽dragged on for more than 18 months聽and led to a聽month-long strike聽late last year. Earlier this month,聽the union began a聽ban on delivering flyers, and dropped its previous ban on its members working overtime, which had been in place since May 23.
In early August, CUPW members rejected the Crown corporation鈥檚 鈥渇inal鈥 contract offer in a vote overseen by the Canada Industrial Relations Board after an order from federal jobs minister Patty Hajdu, who used her authority under Section 108.1 of the Canada Labour Code.
In a memo posted on the union鈥檚 website Monday evening, the head of the Canadian Union of Postal Workers said the Crown corporation was planning for “massive” service cutbacks.
鈥淔or much of the past year, Canada Post has been laying the groundwork for massive service cutbacks. The Corporation has taken every chance it can to play up its聽financial condition, blaming an 鈥榦utdated鈥 regulatory framework 鈥榖uilt for a previous era,鈥 said CUPW national president Jan Simpson.
聽More to come 鈥
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