President’s message
We are living in dynamic and tumultuous times. The long-standing ties that have bound us with our southern neighbour for generations are being broken in real time, with any consequences seemingly dismissed as collateral damage.
Like you, I have been incredibly proud to see the quick and bold reaction from our leaders and everyday Canadians. Governments are responding, businesses are planning, and Canadians are checking labels while going online to find Canadian products and businesses to support. Important public discussions are occurring about how to strengthen our economy, break down barriers and build national resilience.
As we focus our energy on strengthening Team Canada, Canada Post can, and should, play a pivotal role. We are Canada’s delivery infrastructure. We are not perfect, and major changes are urgently needed, but we are the only delivery company with the network, people and commitment to serve all. With Canadian hearts beating with pride, we provide the vital arteries needed to connect all points north, east and west.
We’re an important part of Team Canada – but change is urgently needed
We have been here before. The national postal system emerged in the 1880s along the expanding national railway to help our fledgling country move goods, connect communities and build the economy to fend off an expansive southern neighbour.
Fast-forward to today: bolstering our national economy and identity with a wholly Canadian, publicly owned delivery company is just as compelling. A strong Canada Post ensures Canadian businesses have a fighting chance at home and abroad. We can help them grow their business or transition through today’s realities and so much more. As people across the country shop Canadian, they should always be able to ship Canadian.
There is one major problem, though. As currently structured, the postal system is losing approximately a billion dollars a year and has recorded seven consecutive annual losses. To help Canada Post remain solvent and continue operating, the Government of Canada made repayable funding available to the Corporation. That means we will be there for Canadians in the short term, but the need to change our operating model, respond to our challenges and secure this national infrastructure for the road ahead is more urgent than ever before.
Bold action is required to secure this important national infrastructure
If we dust off our nostalgic view of Canada Post and instead look at it through today’s Team Canada lens, what comes into focus is an incredible economic asset that is ready-built to serve the country and once again build national resilience.
It is therefore time for a bold, new approach to make the postal system financially sustainable and always there for Canadians. To get there, we must first break through the strong resistance to change that has led the national postal system to the brink of insolvency. It has kept us stuck in a mail-based, pre-internet past with a delivery model developed decades ago and a regulatory and policy framework that is just as outdated. The past has caught up to us and we are being quickly pushed to the side in today’s highly competitive parcel delivery market.
A path forward for the postal service
The postal system we know today took shape in 1981, when Canada Post became a Crown corporation. It’s a user-pay system designed to give the postal service the autonomy to operate so that it could evolve in step with the needs of the country. Over time, that autonomy and flexibility have greatly diminished. We have made important changes to improve service and compete in the parcel business, but much more is required. It’s not handouts we need, it is willing partners prepared to work hand in hand with us to make the real changes needed to renew and secure Canada Post.
First, we need a new, more flexible and affordable delivery model, including providing weekend parcel delivery. Our delivery model was negotiated decades ago when our biggest issue was managing a constant stream of mail. That was an important focus during last year’s negotiations with the Canadian Union of Postal Workers (CUPW). Unfortunately, we ended the year with a 32-day national strike which severely impacted employees, small businesses, rural and remote communities, charities and many more.
This is the reality: to be there for Canadians and our employees in the future, we need to do much more. We have the best people in the delivery business, but our outdated delivery model and stringent workplace rules are holding us back. The needs of Canadians should always be our North Star, and we are committed to aligning on a path toward it.
Second, we need a major overhaul of our outdated regulatory and policy framework that belongs next to the Three-Pence Beaver stamp at the Canadian Postal Museum. Oversight is important, but decades of restrictions on the postal system, implemented by successive governments, prevent real transformation while adding costs. The country we serve has changed dramatically, but in many ways, we are still required to operate like the internet is just a passing fad and mail is about to make its triumphant comeback.
We are still required to deliver a letter across the country within four days, largely by air at extra expense, where it will most likely sit in a community mailbox for days until the customer picks it up. We cannot implement changes to a list of rural post offices from 1994, even though about 30 per cent of the communities, like Richmond Hill, Ontario, are now clearly not rural. We are also required to protect mail delivery to the door for less than 25 per cent of households, while 70 per cent of Canadians receive mail delivery to a centralized location, such as a community mailbox, at a fraction of the cost.
Bolstering Team Canada with a renewed national delivery infrastructure
This turning point in our nation’s history may have come with little warning, but everywhere you look, the country is wanting to strengthen all that we value as Canadians. We need that same energy and collaborative effort to renew and revitalize this national infrastructure built to deliver items from Canadian hands to other Canadian hands, no matter where they live. We at Canada Post have been there for Canadians since the very beginning and are fully prepared to tackle our future together, ensuring Canada always remains the True North, strong and free.
Doug Ettinger
President and Chief Executive Officer