November 5, 2003
(Letter sent to the Ottawa Citizen)
I would appreciate an opportunity to respond to concerns raised by Juris Mazutis in a November 2nd letter, "Justify higher postal rates."
Canada Post has been very responsible with its basic letter rate, and since 1982 has managed to keep increases at/or below the rate of inflation. In fact, over the last twenty years the Consumer Price Index (CPI) has risen by 97 per cent while the basic letter rate has gone up only 60 per cent. Had we just kept pace with inflation, it would cost 59 cents to mail a letter in Canada today.
Canada Post is not immune to the rising costs of providing service to our customers. Consider for a moment the price of fuel - Canada Post has one of the largest fleets of vehicles in the country and there are over 750 planned domestic flights carrying mail every business day. Our delivery network expands by some 170,000 new addresses annually and every one per cent of salary increase for our unionized employees equates to a $30 million cost to the corporation.
As well as being the seventh largest employer in Canada, Canada Post spends $2 billion annually on goods and services, creating 30,000 additional jobs. The Corporation is continually investing in new equipment and technology and has a planned investment of $640 million in 2003.
If Mr. Mazutis wants to see the accounting for Purolator, he can simply check our web site and read it in our annual report where it is published every year.
The Price-Cap formula, that limits the amount of increase in the basic letter rate to two-thirds of the rate of inflation, is designed to ensure that Canada Post does not rely excessively on rate increases to achieve our financial goals.
Despite the first increase in two years on January 12th, Canadians will still enjoy one of the lowest domestic basic letter rates among industrialized nations.
Sincerely,
John Caines
Manager, National Media Relations
Ottawa (613)734-7675
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