Why you might want to send Santa an email instead of using Canada Post

With the Christmas mailing season upon us, Canadians are once again reckoning with the bleak future of traditional mail, and familiar troubles of Canada’s most troubled Crown corporation. After Canada Post’s annual meeting this week revealed it is running an operating loss of something like $5 million a day, the National Post explains where things stand in national mail delivery, and where they might be going.

Rotating strikes continue to disrupt mail service. This week on Thursday, for example, mail was not being processed at five sites in Ontario: Georgetown, Orangeville, Oshawa, Scarborough, and a delivery centre in Etobicoke.

Meanwhile, federal mediators are facilitating negotiations between Canada Post management and its largest union, the Canadian Union of Postal Workers (CUPW). There is no collective agreement between Canada Post and CUPW. The last one expired two years ago, and last year there was a month-long strike during the holiday rush.

So there is a national sense of déjà vu. But now this is happening amid the accelerating collapse of the Crown corporation’s business, and the increasingly panicked political effort to reform it. These reforms are supervised by MP Joël Lightbound, the federal minister of government transformation, public works and procurement. In September, he announced the reforms will include more community mailboxes, closures of rural post offices, and reductions in letter delivery standards to allow more ground transport instead of air. He gave Canada Post 45 days to make a plan.

But that is easier said than done. Fearing layoffs, and claiming community mailboxes are inaccessible to many people and magnets for vandalism and theft, CUPW launched a strike, stopping mail across the country. In mid-October, the union switched to the rotating strikes that maintain service in most places.

On Nov. 9, Canada Post privately submitted a modernization plan to Ottawa, and said it remains confident it can reach a deal with its workers. Layoffs of managerial staff were announced in October. Those are in addition to executive layoffs announced earlier this year, along with a $1-billion loan from the federal government.

The budget numbers are really bad. At the annual public meeting on Tuesday, Canada Post chief financial officer Rindala El-Hage said the company is “effectively insolvent,” and has racked up a billion dollars in operational losses this year. An operational loss is money spent to maintain core services without corresponding revenue from those services.

The market share situation is also terrible. Canada Post once dominated the parcel delivery market, but has lost almost all that advantage to private competitors. The ad mail market is small but remains favourable, and letter delivery is in steep decline with no signs of ever coming back.

Canada Post CEO Doug Ettinger said at the annual meeting that the corporation intends to reduce staffing levels through attrition, with 16,000 employees expected to retire or leave in the next five years. Canada Post currently employs about 62,000 people.

For international comparison of drastic solutions, Canadians often look to the Royal Mail in Britain, where the publicly traded national postal service was spun out from a state-owned one. There is a similar model in the Netherlands. But those are smallish countries and their populations are more dense. Canada is geographically vast, like the United States, where the U.S. Postal Service has been in similar financial troubles and is now pursuing both administrative and legislative reform. So for now, the Canadian goal is to repair rather than replace.

The uncertainty causes havoc with delivery plans. A wider strike would be disastrous. Bigger chains are often able to adapt, but smaller companies are often unable to pay the higher prices for private couriers like UPS or Purolator. The uncertainty also comes at the highest volume shopping season of the year, with Black Friday, Cyber Monday and Boxing Day sales all within a month.

Even with labour unrest, it’s usually best to keep faith in the big man. Canada Post advises that you should send your Santa letter no later than Dec. 8 to “Santa Claus, North Pole, H0H 0H0, Canada.” They do not guarantee delivery dates for the reply, but “Santa does respond to all letters he receives,” Canada Post says. They also offer online templates for the letters, for younger and older children.

• FIRST READING: Here's just how much money Canada Post is hemorrhaging
• Terence Corcoran: Money-losing, strike-prone Canada Post needs a Royal resolution

Our website is the place for the latest breaking news, exclusive scoops, longreads and provocative commentary. Please bookmark nationalpost.com and sign up for our newsletters here.