Monday, 29 April 2013

CANADA POST: BEWARE OF POLITICIANS

I propose a warning: “Beware of politicians. Common sense eludes”.

The Conference Board in Canada recently commented on how Canada Post might deal with what it calls "serious financial challenges" due to rapidly declining mail volumes.  According to a CBC News story, the Corporation said it is expecting a "substantial financial loss in 2013."  Actually, the amount is $600 million annually by 2020 even if mail costs are increased by “…10 percent a year starting in 2014…”
The story also quotes NDP Member of Parliament, Olivia Chow, Opposition Critic, who disses any notion of cuts to the ‘snail mail’ service.  Said Chow, “it would be wrong for Canada Post to "retreat" from its mail delivery role.  Instead of contemplating cutting postal services, Canada Post should find new opportunities to provide better and expanded services on the e-commerce front so they can increase their revenues".  

Canada Post has already said e-Commerce would boost only its parcel delivery service which would not make up for its volume losses on general mail.
The national mail service finds itself in a position which is very similar to that of the Yellow Pages Group (YPG), except that Company is not Crown owned.  The ubiquitous use of digital media forced the disappearance of those bulky “Yellow Pages”, in many markets (though not in NL, yet), sending the Company into rapid decline.  All the equity holders were virtually wiped out.  YPG is now trying to survive based largely upon a digital incarnation. Unlike Olivia Chow’s implication that the Federal Government should underwrite the losses of Canada Post, there was no such expectation, on behalf of Yellow Pages, to sustain a service already passé.  Nor should there have been any.

The benefits of technological change do not occur without leaving a trail of hardship for those caught up in the maelstrom. Indeed, change need not be inspired only by digital applications; an ever changing free market presupposes that the supply chain, and the products and services that it delivers, will all be impacted by the ebb and flow of changing human needs.  It should be noted, Canada Post saw some of these changes coming and purchased Purolator Courier to respond to on-line purchases and perform the fast parcel service for which it was not geared.  Competition will keep Purolator lean, unlike it monopolistic parent.
Canada Post’s problems are shared by postal agencies world-wide.  It is no one’s fault. Yet, we constantly look to our political leadership for exemption from the worst impacts of change. That is to be expected; but, when a politician’s only counsel is taxpayer support, that kind of rhetoric is not a palliative anyone can take to the bank.  Nor does it allow an Opposition Party to claim new approaches and better ideas.

It is, of course, the ‘duty’ of Opposition politicians to be critical of Government policies, including how it responds to change.  The pressure which Oppositions, Unions and other interest groups bring to bear is significant and invariably slows down or contorts the process of change in a way that does not always favour ‘progress’, no matter how it may be defined. 
Most politicians know that Canada Post services are now substantially associated with the junk mail industry (that is not to diminish its importance to the economy), they know that Super Mail Boxes have been a feature of new residential developments since the 1980s and that people in older neighbourhoods have gotten used to them, too. Not Olivia Chow.  “Cutting door-to-door delivery to the more than five million Canadian homes that now get it would be unfair. There are people that aren’t very mobile ... who can’t get to a centralized point", said the MP.  She might have enlightened us as to what the immobile do in areas already populated by Super Mail Boxes!

 It takes no genius to write the Canada Post obituary.  Postal workers whose jobs may be threatened as Canada Post shrinks, need more than an Opposition Member’s hope that the Government will ante up any deficits from an already over-stretched public purse.

The narrative for workers, threatened by change, needs changing.
Gone are the days of a single employer providing a life-long career, within government or in the private sector.  Employees across this Country should have no wish to cling to dying companies; what they need is the flexibility to move from one employer to another without losing important pension benefits. They need re-training funds and generous re-location incentives, too.  Financial stability, mobility and job skills represent the perfect tool kit for the modern world.

Ms. Chow might have meant well, but, her Party ought to consider the idea of an employee pensions strategy that is as mobile as the job market, not the inadequate version Finance Minister O’Flaherty is promoting.  We need a system that will accommodate workers whether they have one or twenty employers throughout their working career. Likely modifications to the rules for RRSPs can do the job simply and easily. 
Perhaps, we should not be too hard on Ms. Chow.  Expect the Conservatives, too, to drag their feet on Canada Post reform much as it has by slowing the Corporation’s efforts to invest in new technologies. And, don’t expect any encouragement from public sector unions.  They will hold out, to the end, for a defined benefit pension scheme, only Governments and their Agencies offer, making pension mobility impossible for many.

Canada should become a leader in defining legislation to protect and encourage a mobile pension system.  Add funds for re-training and to ease transitions; likely, moving to a new job might be no much worse an experience than ‘grannie’ feels having to pay her power bill over the internet.

2 comments:

  1. Maybe this is really why they are loosing dollars.

    Critics allege Tories trying to privatize Canada Post

    http://www.lfpress.com/news/canada/2010/06/01/14220216.html

    OTTAWA - The Conservative government is paving the way for the privatization of Canada Post, critics charged Tuesday.

    A measure included in the federal government's 880-page budget bill, eliminates the Crown corporation's monopoly on international letters - a move that will destroy the postal carrier, say the Liberals, NDP and Canadian Union of Postal Workers.

    "This is privatization through the back door," said Denis Lemelin, the union's national president.

    Canada Post uses profits from its international service to "subsidize" deliveries to more remote regions of the country, he said, adding the projected $60 to $80 million cut to the corporation's bottom line would affect service across Canada.

    "Rural delivery will be compromised and prices will increase," warned the Liberal's critic for Crown corporations, Bonnie Crombie.

    "(This) threatens the very essence of the corporation," she said.

    NDP critic Chris Charlton told QMI Agency, if the Conservatives didn't fear a "massive public backlash," they would not have buried the controversial measure in a "Trojan horse" budget bill.

    The minister responsible for Canada Post, Rob Merrifield, said the government has "no plans" to privatize Canada Post and he denied trying to hide the legislative change in a massive bill.

    "Canada Post can compete for international mail, that's not a problem. It will actually make them more efficient and more effective if they can compete in that market," he said.

    Merrifield added the opening up of the international market would not affect rural mail delivery.

    Liberal Sen. Bob Peterson believes the Conservatives can't be trusted on the issue.

    Tuesday, he introduced a motion to further protect rural mail services.

    "Despite lofty promises and empty assurances by Canada Post and the government, the fact remains that 42 rural post offices and 55,000 rural mailboxes have been padlocked since this Conservative government came to office," he said.

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  2. The Government and Canada Post should be constructively utilizing this vast established network to share and bring more services closer to all Canadians (ex grant availability, services available for ill, aged, or injured and young Canadians, a local source for information on any subject pertinant to Canadians) not desimate it !!!

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