Canada Post CEO defends delivery cuts, says "seniors will get more exercise"

[The Intransigent Faction]

Canada Post ’s top executive says ending home delivery and shifting millions of Canadians to community mailboxes offers at least one unintended upside – more exercise for seniors.
Making his first public appearance since the post office announced a controversial plan to stem mounting losses, Canada Post chief executive Deepak Chopra cast the austerity moves as a careful balance between the competing needs of Canadians and the Crown corporation’s dire financial predicament.

The changes include an end to home delivery of letters, a 35-per-cent hike in the price of stamps and the elimination of up to 8,000 jobs.
Many welcome the idea of walking to a centralized neighbourhood mailbox – already the reality for roughly a quarter of households – he said at an emergency session of the House of Commons transport committee Wednesday, requested by the opposition.
“The seniors are telling me, ‘I want to be healthy. I want to be active in my life,’” Mr. Chopra told MPs. “They want to be living fuller lives.”
The shift to community mailboxes will free up more quality time for busy families by making it easier for them to receive online purchases at secure locations, he added.

Mr. Chopra insisted all the changes are the result of “robust” consultations with Canadians about the future of the post office in the digital age. Canada Post currently delivers mail and parcels to 15.3-million households and businesses. A third of those, or 5.1 million, that now get door-to-door delivery, will lose the service over the next five years. The rest of Canadians get their mail either at group mailboxes, apartment lobby boxes, post offices or on rural roads, and they will be unaffected.

The suggestion that Canadians want less service and higher rates sparked outrage from opposition MPs and the Canadian Union of Postal Workers. They also complained that Canada Post didn’t explore options to generate more revenue, including offering banking services.

Liberal MP David McGuinty mockingly called Mr. Chopra’s postal plan “mail Participaction” – a reference to the government’s national fitness program.
NDP MP Paul Dewar disputed the notion that the post office consulted widely with Canadians before announcing the changes. “Sir, most Canadians had no clue. No one knew you were doing this in a robust way,” he said as he quizzed Mr. Chopra.

Canada Post has released a 19-page document, which it describes as a summary of four months of consultations with thousands of Canadians in 46 communities across the country. In it, the post office said Canadians would support an end of home delivery and would accept higher stamp prices if it keeps the postal service from becoming a burden on taxpayers. Mr. Chopra declined Mr. Dewar’s request to table the full details of those consultations, and he dodged questions about when he alerted the government of its plan to chop home delivery.

“I realize these are difficult choices that are going to be tough on some people,” Mr. Chopra said.

The post office had little choice because it is facing a crippling decline in letter mail, mounting losses and a $6.5-billion pension solvency deficit, according to Mr. Chopra. “We have a corporation that is facing an inflection point with the technology that is wiping out the very foundation that [Canada Post] was built on,” he told the committee.

The post office delivered 1 billion fewer pieces of mail in 2012, compared to 2007. Letter-mail volume is declining at a rate of roughly 5 per cent a year. At the same time, the post office’s parcel business is growing rapidly as more people shop online.
“If the mail is changing its shape and size, don’t we think the mailbox should change its size too?” he asked MPs. Doing nothing in that environment wasn’t an option, he explained. “Every day of delay is going to cost us millions,” he said.

Mr. Chopra promised that the installation of community mailboxes would be done in a “thoughtful manner” and that the post office would communicate extensively with Canadians. The post office is looking at mainly installing the boxes on local government land, including parks, schools and government offices, Mr. Chopra told The Globe and Mail before the committee meeting. He said Canada Post doesn’t pay municipalities for locating boxes on their land. Canada Post is also considering working with retailers to install the boxes near stores, Jacques Côté, president of the post office’s physical delivery network, told reporters.

Editor's note: An earlier version of this story misidentified Canada Post's pension solvency deficit as $6.5-million instead of $6.5-billion. This version has been corrected.

Long story short, they are cutting back on certain postal services apparently due to financial pressures.

I've been seeing people argue that door-to-door deliveries are a sign of bureaucratic inefficiencies and "Any actual private company would centralize mail entirely".

It's hard to argue that "snail mail" isn't an anachronism, but at the same time I wouldn't want to see workers' jobs slashed as 'inefficiencies'. So, my question is, in the current capitalist political context, what can be done to protect workers' interests besides essentially becoming a Luddite?

EDIT: Also, yes, I am entertained by the fact that Deepak Chopra is the CEO of Canada Post. :D

[blake 3:17]

For clarity's sake, this Deepak Chopra isn't the New Age guru.

CUPW have presented alternate directions for the future of Canada Post. The Postal Workers have been radical of major unions in Canada.


They are in a very weak position. Chopra has handed sisters and brothers a gift with this stupidity.

[Brandon's Impotent Rage]

That is some serious "Let them eat cake!" shit right there.

I tremble to think of what would happen if the Canadian government tried to abolish the Universal Healthcare in that country. The blood would flow from Ottawa all the way to Louisiana.

[Ocean Seal]

Long story short, they are cutting back on certain postal services apparently due to financial pressures.

I've been seeing people argue that door-to-door deliveries are a sign of bureaucratic inefficiencies and "Any actual private company would centralize mail entirely".

It's hard to argue that "snail mail" isn't an anachronism, but at the same time I wouldn't want to see workers' jobs slashed as 'inefficiencies'. So, my question is, in the current capitalist political context, what can be done to protect workers' interests besides essentially becoming a Luddite?

EDIT: Also, yes, I am entertained by the fact that Deepak Chopra is the CEO of Canada Post. :D
Hold on if anything you need to become the opposite of a luddite. Embrace the new times and don't ask to keep the jobs that you have, instead ask for the mechanized and electronic processes to work for us. Ie: Ask for all of the workers to be kept all the while electronic processes assist them in their jobs and they work less hours for more pay. That's the point of mechanization. To make our lives easier and we need to take control of it.

[The Intransigent Faction]

the mechanized and electronic processes

You mean like...e-mail? Where does that leave postal workers, then? I'd tend to agree that's the rational purpose of mechanization, but unless we abolish capitalism tomorrow, what's going to happen to these people since the need for that physical middleman is at least reduced with current technology (at least in terms of say, Christmas-card type letters, though not larger packages)?

[Die Neue Zeit]

Postal savings bank could save mail delivery (http://www.thestar.com/news/canada/2013/12/20/postal_savings_bank_could_save_mail_delivery_walko m.html)



By Thomas Walkom

By pledging to slash services and hike stamp prices, Canada Post has set itself on the road to extinction.

It doesn’t have to be that way.

The Crown corporation says it plans to end door-to-door delivery for five million households even as it raises the price of a stamp to $1. It says it has no choice if it is to avoid losing money.

Yet Canada Post is far from being a financial basket case. Its letter mail volumes may be shrinking. But with one exception, it has posted a profit every year since 1994.

It still has more retail outlets across Canada than any other company. It has spent millions upgrading its delivery technology and has started to move into new areas of business.

The Canadian Union of Postal Workers, which represents most employees at the crown corporation, argues that one of those new areas should be banking. It makes a surprisingly strong argument.

I say surprising because Canadians don’t usually associate the post office with banking. But as John Anderson points out, in a research paper published this fall by the Canadian Centre for Policy Alternatives, postal savings banks are money makers world-wide.

New Zealand’s postal banking system, which was re-invigorated just eight years ago, now accounts for 70 per cent of the profit earned by that country’s post office. The comparable figure for Italy is 67 per cent.

France’s postal savings bank accounts for 36 per cent of its postal service’s pre-tax earnings. Britain is privatizing mail delivery. But it is not privatizing its system of post offices and postal savings banks. They’re too lucrative.

Would postal savings banks work here? Would they provide enough revenue to cross-subsidize money-losing mail delivery?

Canada Post’s current management pooh-poohs the idea. But former Canada Post CEO Moya Greene, who is generally regarded as a business superstar (in 2010, the Brits talent-spotted her to head up the Royal Mail), was much more open to the idea.

Speaking to a Senate committee three months before taking up her Royal Mail job, Greene said Canada Post was seriously considering the idea of offering full financial services.

“We . . . need to diversify the revenue stream and be in wholly different businesses than we are today,” she told the committee. “I note, for example, that many postal administrations have made a success of banking.”

She pointed out that Canada Post currently operates a $1 billion money order business and that in many northern communities the local post office already acts as a kind of bank.

In fact, Canada used to have a postal savings bank system. Pierre Trudeau’s Liberal government abolished it in 1969, in part because — given that the chartered banks operated branches almost everywhere — it seemed unnecessary.

But as Anderson notes, the chartered banks are pulling back. Canadian banks now have 1,800 fewer branches country-wide than they did in 1990. Credit unions, too, are scaling back.

Up to 15 per cent of Canadians are estimated to have no bank accounts at all, which leaves them reliant on so-called payday lenders charging interest rates that, in Ontario, can exceed 540 per cent.

Anderson’s point is that there is a role for a national postal savings bank in Canada. Certainly, the chartered banks, which altogether earned $28.6 billion in profits last year, could use the competition.

At base, Canada Post is an operation characterized by high overhead costs. These represent the buildings, equipment and labour needed to operate a coast-to-coast operation. Such overhead costs are both the company’s weakness and its strength.

They are its weakness because they do not fall when revenues drop. It is as expensive to deliver 10 letters to a particular block as it is to deliver 100.

But they are its strength because they allow for economies of scale. Which is another way of saying that Canada Post, if it had the wit, could use the cross-country structure it already has in place to offer something more.

The union says that this something more could include banking. Don’t dismiss the idea out of hand. Canada Post’s alternative strategy — less service at higher prices — can only result in a death spiral.