Canada Post's delivery debate reignites as Liberals set to take office
Crown corporation should invest in parcel service, not mail, business professor says
News of Canada Post's temporary reprieve on cutting door-to-door service has reignited the debate about the future of the Crown corporation — and whether it provides an essential service.
Some have interpreted the Liberal pledge to deliver "high-quality service at a reasonable price to Canadians, no matter where they live" as a promise to save door-to-door mail service for the 32 per cent of households that still get it.
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That includes the postal workers union, whose president told CBC News that it didn't make sense to cut a valuable service when the Crown corporation was still posting a profit — about $24 million before tax in the first quarter of the year.
But business professor Ian Lee says that Canada Post should stick to its plan. In fact, he hopes the review will cut delivery to communities back even further, to just three times a week
'Traditional mail will vanish'
Scaling back services reflects the move to online communication, from social media to texting to online billing and banking, the Sprott School of Business professor said.
"I predict traditional mail will vanish," he said. "Canada Post's future, if it has one, is in parcels, not letters."
In 2014, the postal service reported it delivered about 1.4 billion fewer letters and pieces of mail than it did in 2006, a downward trend that's projected to continue by between five and seven per cent each year, Lee said.
Canada Post has to evolve as a business, Lee said, by turning its post offices into franchises — and investing that revenue and the savings on mail delivery into growing its parcel service.
Lee, who has written extensively about Canada Post's business model, said that about 20 per cent of the corporation's deliveries are packages, an uptick in recent years thanks to the growth of online shopping. Letters and ad mail make up 70 per cent of its business.
"But that portion of the company is collapsing faster than the one-fifth can grow," Lee said.
To make home delivery profitable, Canada Post could look at switching to a user-pay system, said Walid Hejazi, an associate professor at the Rotman School of Management.
For those who want the service, they can pay for it — about $270 a year, he argued.
"I think you'd see people do the math and realize that if they're only getting mail once or twice a week, they're not going to pay for it themselves," he said.
Right now, older neighbourhoods still have door-to-door service. The Mulroney government began phasing it out in 1985, declaring that new subdivisions would include community mailboxes.
But Hamilton Coun. Terry Whitehead said there's a difference between planning a development around a mailbox and putting one in as an afterthought.
"We cannot be putting these in areas where there's no light, where there are no curbs, on arterial roads," he said. "The issue of safety is one that's fundamental."
Since the decision to scrap home delivery, Whitehead has called for municipal governments to get the last call on where the mailboxes should go, since they are familiar with the territory.
We cannot be putting these in areas where there's no light, where there are no curbs, on arterial roads.… The issue of safety is one that's fundamental.–Hamilton Coun. Terry Whitehead
Whitehead said he'd like to see an analysis done on the possibility of privatizing home delivery, but he hopes that Ottawa steps in and makes municipal councils the final arbiter of what's safe for the placement of the neighbourhood mailboxes.
Whitehead said he also wants the review to look at other options for people with disabilities who may rely on getting their mail at home.
To qualify for home delivery as Canada Post phases it out, an applicant needs to submit a doctor's assessment.
Joanne MacDonald said that plan violates a person's right to privacy, however, especially since only those with disabilities would be required to offer their medical histories.
MacDonald, a Paralympian and disability advocate based in St. John's, has not been able to use the community mailbox she was assigned this week, despite requesting one that's accessible.
She said the corporation must consult with its customers with special needs before it makes any more changes to its services.