Critics blast Canada Post's plan to phase out door-to-door delivery

A Canada Post mail carrier walks in Ottawa, Wednesday, Dec.11, 2013. (Sean Kilpatrick / THE CANADIAN PRESS)

The union representing postal workers says it will fight Canada Post's decision to eliminate door-to-door mail delivery as the company struggles with continued losses.

President of the Canadian Union of Postal Workers Denis Lemelin said the Crown corporation could reduce costs through innovation rather than cutting jobs and scaling back services.

"We recognize that Canada Post needs to change, but this is not the way to change -- to cut, cut and cut," Lemelin told reporters during a news conference on Wednesday, the same day the postal service announced a new five-point plan aimed at returning the company to financial stability by 2019.

Lemelin said CUPW has been advocating for postal banking -- where post offices offer basic banking services -- as a way to increase revenues.

"This shows it's possible to change," he said. "We are sure that we are not alone – there are more people than us that are disagreeing with Canada Post's plan."

Canada Post unveiled its new business strategy on Wednesday, which will see the end of regular door-to-door mail delivery in urban centres, up to 8,000 jobs cut and an increase in the cost of stamps as part of sweeping changes aimed at turning the business around.

Spokesman Jon Hamilton said community mailboxes offer increased security for Canadians and are more "convenient."

“When you look at community mailboxes, and you know that people are shopping online and they’re not at home, or the kind of mail they’re going to get in the future is more drivers licences and health cards, it makes a lot more sense to have those in a locked box,” he told CTV’s Power Play.

But when asked whether there would be exceptions for people with mobility issues who are unable to travel to community mailboxes, Hamilton said Canada Post would find other potential solutions.

“We’ll find ways to make the community mailbox accessible,” he said. “We’ll find ways to provide additional keys, so caregivers who come and help with the other things that are part of their day-to-day life, mail service can be part of that.”

He added that “door-to-door delivery has really only been a reality for a third of Canadians for a long period of time.”

Transportation Minister Lisa Raitt says she supports the changes, noting that in a digital age, Canadians are sending less mail than ever.

"Due to the lack of demand, mail volumes have dropped almost 25 per cent per address since 2008 and continue to fall," Raitt said in a statement. "This is leading to a steep decline in revenues for Canada Post. Since 1981, Canada Post has had a mandate to operate on a self-sustaining financial basis."

While serving as the Conservative’s labour minister in 2011, Raitt tabled legislation that saw 50,000 locked-out Canada Post employees ordered back to work.

Following Canada Post’s announcement, Raitt said the coming changes are necessary to "protect taxpayers."

Five-point plan

Canada Post said four of the five initiatives announced Wednesday are expected to save between $700 million and $900 million annually.

"Canada Post has a mandate to fund its operations with revenues from the sale of its products and services, rather than become a burden on taxpayers," the company said in a statement. "With the increasing use of digital communication and the historic decline of lettermail volumes, Canada Post has begun to post significant financial losses."

In its last quarter alone the corporation reported a loss of $129 million.

A think-tank commissioned by Canada Post earlier this year warned that the postal service was on track to lose $1 billion annually by the end of this decade.

The Conference Board of Canada study estimated savings of $576 million a year by eliminating door-to-door delivery to urban homes.

Those areas – which account for about one-third of Canadian households -- will transition to community mail boxes over the next five years. Implementation of the changes will begin in the second half of 2014.

The first neighbourhoods that will stop receiving door-to-door mail delivery have yet to be announced.

Stamp prices increasing

The price of a stamp for a standard letter is currently $0.63, but beginning March 31, 2014 consumers will have to pay $0.85 for stamps purchased in booklets or coils, and $1 each when purchased individually.

CUPW warned that the "skyrocketing" price of stamps will make the postal service inaccessible to a number of Canadians.

Canada Post said it is also planning to cut between 6,000 and 8,000 positions over the next few years, but noted that most of that workforce reduction should come through attrition as nearly 15,000 employees are expected to retire or leave the company within five years.

"With its current labour costs, Canada Post has a much higher cost structure than its competitors in the private sector have," the company said in statement issued Wednesday morning. "This is simply not sustainable. The company will continue to bring the cost of labour in line with its competitors through attrition and collective bargaining over time."

The company also said it will take the necessary steps to permanently address the sustainability of its pension plan.

"A leaner workforce will create a more flexible and competitive Canada Post," it said.

The new business plan also includes expanding the number of postal outlets and stores throughout Canada, and streamlining operations by using more advanced technology.

Some of the ideas include using faster computerized sorting equipment, processing mail and parcels in a central location, and providing more delivery employees with fuel-efficient vehicles.

NDP slams 'disrespectful' timing

The New Democrats have already slammed the changes to the business model, saying other cost-cutting measures could have been explored.

NDP MP Olivia Chow said a number of countries in Europe have successfully implemented postal banking services and are now making money.

"Instead what Canada Post is doing is cutting service and eliminating many of the front-line services instead of increasing revenue," she said during a news conference Wednesday.

Chow said the changes would destroy the "long-treasured tradition" of getting door-to-door mail service in Canada.

"By dramatically increasing the rates of stamps, the Conservative government is really destroying postal service," she added.

NDP MP Peter Julian said he's concerned that the loss of up to 8,000 jobs will have an impact on the economy.

"New Democrats are thinking about the loss of service to Canadians -- thinking of what will happen to senior citizens in winter months if they’re not getting service at home," he told reporters in Ottawa on Wednesday.

Julian said the fact that the changes were announced one day after MPs voted to end the fall parliamentary session is "disrespectful" to Canadians.

"There should have been having a dialogue with the union and talks with communities. They haven’t done any of that. They’ve announced this unilaterally,” he said.

Liberal leader Justin Trudeau said Canada Post failed to undertake an in-depth study before announcing the changes.

"We need to make sure that Canadians are being properly served by an institution like Canada Post, and that will require a little more robust discussion and study than this government has actually taken on."

Ontario Premier Kathleen Wynne said while she couldn't comment on the changes coming to Canada Post, she acknowledged that the way individuals communicate has changed drastically over the last decade.

"I think all of us would recognize that we write letters infrequently," she told reporters at Queen's Park. "We do not use the post in same way we did previously. My grandmother wrote letters all the time, but she didn't have a BlackBerry; she didn't have a computer.

"So we’re going to have to adjust to those realities.”