Canada’s government announced a significant overhaul of its national postal service on Thursday, mandating an end to door-to-door mail delivery, the closure of some rural post offices, and a consolidation of operations. These sweeping changes are a direct response to severe financial losses that threaten the very existence of the mail carrier.
Canada Post, the country’s government-owned postal service, has accumulated losses exceeding 5 billion Canadian dollars (approximately $3.6 billion USD) since 2018. This escalating deficit is primarily attributed to a sharp decline in traditional letter mail. Efforts to offset these losses by expanding parcel delivery have proven insufficient, as this segment of the shipping industry is intensely competitive.
During a news conference on Thursday, Joël Lightbound, Canada’s Minister for Public Services, declared that “Canada Post is effectively insolvent and facing an existential crisis.”
These government-imposed cost-reduction strategies aim to stabilize Canada Post’s financial health after numerous previous bailouts. The measures are anticipated to lead to substantial job cuts among the postal service’s 68,000-strong workforce.
Doug Ettinger, CEO of Canada Post, stated that “Today’s announcement will enable us to implement necessary changes to revitalize Canada’s postal service for all Canadians, adapting to better serve their evolving needs.”
Door-to-door mail delivery was already a diminishing practice throughout Canada, with only approximately 25 percent of residents still receiving mail directly at their homes. The majority of Canadians currently retrieve their mail from individual boxes located within community mailbox units, typically situated near their residences.
Despite the existing shift, the complete phasing out of the remaining door-to-door service will impact approximately four million addresses, according to government figures.
Ian Lee, a business professor at Carleton University in Ottawa and an expert on the postal service, commented, “The data clearly indicated that Canada Post was in dire need of reorganization and restructuring.”
Canada Post had previously initiated a transition away from door-to-door delivery, but this process was halted when former Prime Minister Justin Trudeau made it a key promise during his successful 2015 election campaign. Upon assuming office, one of his initial directives was to instruct the postal service to cease its planned conversion to community mailboxes.
However, since that time, the volume of traditional letter mail has drastically fallen, with an accelerated decline observed particularly during and after the Covid-19 pandemic.
Although a June poll by the nonprofit Angus Reid Institute indicated that Canadians generally do not favor a complete end to door-to-door delivery, public sentiment has shifted. Given the postal service’s precarious future, there is now greater support for operational changes and service reductions compared to previous years.
Mr. Lightbound emphasized the political imperative, stating, “The political decision is that we can’t, Canadians can’t, be footing an ever-growing bill year after year.”
Officials confirmed that while no definitive date has been established for the complete cessation of at-home mail delivery, the changes will be rolled out progressively.
Additional measures include a shift to ground transportation for certain mail to reduce costs. Furthermore, the government has lifted a 1994 ban on closing rural post offices, a policy that also sparked considerable political debate when initially introduced.
The union representing postal workers and Canada Post are currently engaged in contentious contract negotiations, which previously led to a strike earlier this year. The union was expected to table its most recent offer on Friday.
The union did not provide an immediate response to requests for comment.
Stephanie Ross, a professor of labor studies at McMaster University in Hamilton, Ontario, suggested that another worker walkout is now probable. “The union’s leverage at the bargaining table has been significantly undermined,” she commented, adding, “I can’t imagine how angry people are.”
_Additional reporting by Ian Austen from Ottawa._