Bleeding money, Canada Post slashes home delivery; workers go on strike
CANADA announced on Thursday that its money-losing postal system would no longer provide home delivery five days a week, as it makes big cuts to remain viable.
As is happening in many countries around the world, Canada Post has seen a huge drop in mail volume - 3.5 billion pieces fewer per year compared to 20 years ago.
The system loses C$10 million (S$9.3 million) a day, said public services minister Joel Lightbound.
“Canada Post is facing an existential crisis,” Lightbound told a news conference without saying what would replace the current home delivery model. Canada Post is expected to announce an alternative.
Lightbound called on Canada Post to create more group mailboxes that neighbours share -- the way three-quarters of Canadians already get their mail.
Canada Post must also come up with a plan to modernise rural delivery of mail.
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The changes come after months of talks between Canada Post and its employees on working conditions.
In response, Canada Post workers went on nationwide strike on Thursday, the Canadian Union of Postal Workers said.
“In response to the Government’s attack on our postal service and workers, effective immediately, all CUPW members at Canada Post are on a nationwide strike,” the union said.
Canada Post did not immediately respond to a Reuters request for comment.
Earlier on Thursday, the Canadian government instructed the company to undergo changes to its operations, saying that Canada Post faces structural challenges, which - coupled with outdated restrictions and stalled negotiations between labour and management - have limited its ability to adapt, causing mounting losses.
“This situation is unsustainable. Canada Post is effectively insolvent, and repeated bailouts are not a long-term solution. Transformation is required to ensure the survival of Canada Post and protect the services Canadians rely on,” the government said in a statement.
In response to the strike, the Canadian Chamber of Commerce called for a return to the bargaining table for negotiations in good faith. A strike that lasted nearly a month shut down the system in late 2024.
Canada is not the only country whose mail system is in trouble.
Denmark said its state-run postal system will end deliveries at the end of this year. And in Germany, Deutsche Post said it will eliminate 8,000 jobs to cut costs. AFP, REUTERS
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