JAY GOLDBERG: The feds need to stop dithering and privatize Canada Post

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Canada Post is losing billions. Last year, it lost $1.3 billion and saw parcel delivery revenues alone decline by a jaw-dropping $683 million. This helped trigger the billion-dollar taxpayer bailout Justin Trudeau’s government gave to the Crown corporation in January.   

And if those numbers sound bad, Canada Post itself expects the crisis to go from bad to worse as its unionized workforce continues to resist the corporation’s every effort to modernize.   

At the same time Canada Post has been losing money hand over fist, unionized employees are demanding the status quo and pay raises.  

After a year and a half of negotiations and a “final offer” from Canada Post, federal Minister of Jobs Patty Hajdu stepped in and asked the Canada Industrial Relations Board to force Canada Post’s most recent offer to a vote.  

The offer included a 13% pay raise over four years. Yet more than two-thirds of Canada Post’s unionized employees voted to reject the deal.   

That plunged Canada’s business community, and those who rely on Canada Post for mail delivery, into more chaos and uncertainty. After a strike last fall, there’s every possibility Canadians could be staring down another strike from Canada Post’s unionized employees in the coming weeks or months.  

Enough is enough.  

Canada Post hasn’t run a profit for eight years. And over the past five years alone, it has posted annual losses of at least $490 million.   

Canada Post has been living off reserves, but the cupboards are bare. If decisive action isn’t taken, billion-dollar bailouts will become the new normal.  

And with a federal deficit likely nearing $100 billion, Canadians can’t afford annual billion-dollar bailouts for a failing Crown corporation whose employees won’t allow it to make much-needed reforms.  

Canada Post CEO Doug Ettinger gets that there’s a crisis. As he said in May, “Our current structure was built for a bygone era of letter mail — the status quo has led us to the verge of financial insolvency is not an option.”  

Yet the union wants the status quo, and then some. Something must give.   

It’s high time for the government to get out of the postal business and privatize Canada Post.   

Countries like Germany, Sweden, Belgium, the Netherlands and Austria have all privatized their postal services, many with great success.  

In the case of Germany, Deutsche Post continues to deliver some of the best service in the world as a private corporation and posts healthy profits in doing so.   

Its performance outcomes are far better than Canada Post, according to the Universal Postal Union.  

The naysayers say privatization can’t be done and that Canada Post should continue business as usual.   

But business as usual is quickly going to mean regular bailouts, with taxpayer funds spent on a failing mail delivery service instead of hospitals, schools, roads or lower taxes.   

And experiences in countries across Europe, many of which are known for their centrist and even left-wing politics, show that privatizing mail services can be done, and it can be done quite successfully.   

Those who oppose any kind of change at Canada Post are simply closing their eyes to the reality that’s right in front of Canadian taxpayers.   

It’s also time to bust the myth that privatization would not necessarily, or even likely, mean higher prices for consumers.  

Just look at the evidence from Europe.  

In European countries that privatized their postal delivery services, stamp prices actually fell between 11% and 17% over the first decade of privatization, after accounting for inflation.   

Better service and lower prices. That’s something every Canadian taxpayer should want to see.   

A privatized Canada Post could mean more affordability and more options. It would also mean that Canadians would never again be held hostage by the possibility of yet another union strike like the one we saw last year. Without a public monopoly, even if Canada Post’s employees remained unionized, a strike would have a much more limited impact.   

The downsides of not acting are clear. And the upsides of privatizing Canada Post are clear, too.   

It’s time for the Carney government to stop dithering. It’s time to privatize Canada Post.   

Jay Goldberg is the Canadian Affairs Manager at the Consumer Choice Center