Analysis & Comment

COMMENTARY: Time to put an end to our antiquated mail monopoly

The decision by Greyhound to terminate its operations in Western Canada created a significant void for much-needed bus service. A number of private companies have stepped up to fill some of that void and an assortment of different ideas have been proposed for how best to ensure that more remote rural communities have access to such transportation options.

It is worth noting that no one has proposed the creation of a government-run transportation company with a legislated monopoly on certain key routes. Certainly, no one has suggested that bus service between communities be offered for a taxpayer-subsidized flat rate.

It’s a remarkable contrast between the status quo around mail delivery in Canada and how absurd such a design would seem for just about any other kind of service. No equivalent of Canada Post exists for offering groceries or prescription drugs or other essentials and yet somehow the country manages.

Home mail delivery — and Canada Post itself — has become increasingly irrelevant to Canadians and yet we can’t seem to bring ourselves to a serious consideration of any meaningful chance. Instead, we get tinkering of the status quo and an ongoing series of labour disputes — labour disputes that could once cripple the Canadian economy but now go unnoticed by many Canadians.

The current Liberal government has had to learn the harsh realities that previous governments have. After disappointing the postal union and its allies by breaking a promise to restore door-to-door mail delivery, the Liberals have further drawn the ire of the defenders of the status quo by tabling back-to-work legislation to end the current rotating strikes by postal workers.

Once the workers are back working, the strategy appears to be to simply go back to sleep and ignore the status quo until the next crisis arises. In the meantime, however, mail volumes continue to drop and the associated losses continue to mount. In fact, Canada Post recently announced a whopping $242-million loss for the second quarter of this year. There’s also the massive pension shortfall the company is facing.

Clearly, something has to change.

The bright spot for Canada Post has been the parcel side of its business. With the growth in e-commerce, it’s easy to see why. But this is an area in which there is competition. If there is a healthy demand for such services and plenty of companies willing and able to provide it, why do we need Canada Post? Moreover, if we can allow the private sector to compete when it comes to parcel delivery, then why can’t the same apply to letter delivery?

Other countries have had success in privatizing or liberalizing postal service and there’s no reason why Canada couldn’t as well. Selling off Canada Post might be a way of generating enough revenue to cover off the pension shortfall.

Short of privatization, however, other options exist. A 2016 study from the University of Calgary’s School of Public Policy, for example, made the case for Canada Post being allowed to charge different rates, depending on the type of sender, the volume of the mail, and the mail’s destination. It also suggests that customers have the option of paying for different levels of service, such as daily, door-to-door delivery. Outsourcing certain operations or reducing the delivery frequency in certain areas would be other ways of realizing cost savings and efficiencies.

Even in a worst-case scenario where a privatized Canada Post meant the potential of certain communities being cut off or facing high costs for mail service, we’d be in exactly the same sort of situation we’re facing now with Greyhound and rural bus service. If there was a need to subsidize private companies for covering certain routes or providing subsidies directly to certain customers, we’d still probably be far better off under such a scenario than we are with our status quo.

Unfortunately, that antiquated, unnecessary status quo isn’t going away anytime soon.

Rob Breakenridge is host of “Afternoons with Rob Breakenridge” on Global News Radio 770 Calgary and a commentator for Global News.

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