Home » Daily letter deliveries in the firing line as part of new Australia Post review

Daily letter deliveries in the firing line as part of new Australia Post review

Australia Post’s weekday letter-delivery obligations are “no longer financially sustainable” and need to be reviewed, according to a new consultation paper released as part of a federal government review of the postal service.

The government has launched a sweeping review of Australia Post’s business model with an eye to scaling back its deeply unprofitable letter delivery service to prioritise its fast-growing parcel service instead.

Australia Post is entirely government-owned but also entirely self-funded, and works under strict obligations to provide near-universal letter deliveries to Australian homes five days a week and operate post offices close to homes.

It also aims to turn a profit and deliver those returns to the government.

That will not be the case this year, with Australia Post expected to run at a loss for the first time since 2015 — and those losses are expected to grow in the years ahead.

In a new consultation paper released today, the federal government is flagging that the requirements placed on Australia Post will likely need to change for the business to remain viable.

“The existing Community Service Obligations are no longer financially sustainable and are not well targeted at the needs of Australians due to changes brought about by the digitisation of the economy,” it reads.

Communications Minister Michelle Rowland said the government wanted broad feedback before it started considering various options.

“The consultation announced today will ensure Australia Post maintains the long-term financial stability it needs to continue supporting small businesses and providing essential community services — particularly in our rural, regional and remote communities,” she said.