The price and frequency of letter deliveries could soon change as part of a major rethink to the future of Australia Post.
With Australian households on track to receive just one letter a week within 10 years, the government is seeking public opinion through a consultation process on what the future of the postal service will look like.
Last month, Australia Post reported a significant financial deterioration, notably a record first-half letters loss of $189.7m. This financial year will also be the first full year loss since 2015.
Households receive approximately 2.4 letters a week – a third of what they received in 2007-08 – with modelling predicting that will halve again by 2032.
Less than three per cent of letters are sent by consumers, with the remainder sent by business and governments. The average person sends just 15 personal letters a year.
A discussion paper released by the government on Thursday suggests the price of sending letters is likely to need to increase to keep up with the declining demand and cost of other parts of the service, as has happened in similar countries.
The discussion paper labels the current postal regulatory framework – which includes the performance standards to deliver stamped reserved letters in accordance with the regulator or priority timetable – “inflexible”.
The government said it wants the public’s view on whether to change letter pricing arrangements to “support Australia Post recover the actual cost of its service”, while maintaining subsidised social mail pricing for concession card holders.
It’s also seeking feedback on whether to relax letter delivery frequency requirements, which the discussion paper said is “particularly cost burdensome in the face of declining volumes”, while also seeking to maintain “appropriate” maximum letter delivery speed regulations.
Australians are also being asked to consider whether to deregulate the priority letter service.
Meanwhile, one-in-five retail purchases are made online and Australia Post delivered more than 500 million parcels around the country in 2021-22.
Communications Minister Michelle Rowland said it was critical the national postal service kept pace with shifting demands and the government was committed to helping the postal service adapt.
“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.
“I encourage all Australians to have their say, especially small businesses. Your opinion will help us as we consider options to shape postal services and sustain Australia Post now and into the future.”
Finance Minister Katy Gallagher said Australia Post was a constant in the Australian landscape.
“The government is committed to ensuring that Australia Post continues to modernise, to ensure that it is financially sustainable and continues to provide employment opportunities, and deliver essential services to all Australians – particularly in regional, rural and remote Australia,” she said.
The discussion paper asks for Australian individuals, charities, communities, businesses, as well as Post Office licensees and agents, and the wider Australia Post workforce, to have their say on the future of the corporation.
Ways to modernise the service could be through increasing flexibility and delivery reliability for parcel delivery, making it more convenient and accessible for consumers and small businesses, and continued support for regional and remote communities.
Submissions will close on April 27.