The Postal Services Modernisation Discussion Paper published by the Australian government puts forward considerations for the next stage of Australia Post’s evolution.
Technological changes disrupted the postal service a long time ago, which enabled the post to deliver innovations to customers. However, the regulatory obligations imposed on Australia Post through the Australian Postal Corporation Act 1989 have not kept pace with either the opportunities of digitization or the cost of changing trends.
Australia Post believes that the letters service is no longer sustainable, incurring a record loss of A$189.7m over the first half of FY 2023. Australia Post does not receive financial support from government, yet is expected to generate a return and remain financially sustainable. For that to happen there needs to be modernization in operations and in the postal service regulatory framework.
Australia Post has stated that it supports the government’s proposal that modernization adhere to the following principles:
- Australia Post remaining in full public ownership, providing a universal and equitable service that meets the needs of Australian people and businesses;
- Australia Post remaining financially sustainable and investing in its networks, services and people to support improved national productivity and supply chain resilience;
- Postal services that support Australia’s digital economy, particularly as a critical enabler of the growing e-commerce market;
- Providing appropriate coverage of the post office network, particularly in regional areas, and supporting Licensed Post Offices and Community Postal Agents financial sustainability;
- Reducing Australia Post’s operating cost in delivering regulated letter services, freeing up delivery and processing resources to support parcels delivery to respond to increasing demand and consumer expectations.
For Australia Post, having a regulatory framework that enables it to modernize is fundamental as it continues to evolve to meet rapidly changing customer needs and expectations.
As with other posts worldwide that are also navigating these challenges, there are reforming and modernizing options that could be considered.
- Letter pricing – a simplified regulatory approach to letter pricing oversight to ensure it can be adjusted efficiently as mail volumes and efficiencies of scale decline and the number of delivery points increase.
- Letters delivery – updating delivery methods to drive greater efficiency and use resources more effectively.
- Retail network – ensuring that the post’s physical presence across the country has the flexibility to reflect the changing expectations and interactions of customers in physical stores, accessing services and shopping in an increasingly digital world.