Government Operations Committee on Sept. 29th, 2016

[Kelly McCauley, Conservative, Edmonton West, AB]

It's striking that the more we go around, especially to the rural areas.... You mentioned that the level of service in Toronto versus out here is very different. It's the same in many Alberta rural areas. I don't want to say they put up with less, but they accept less than larger municipalities, and that's very true for health services and a lot of other things. It's more and more apparent that we have to approach this as two different issues that we're going to have to address. There's the rural issue and the downtown one.

I want to follow up on what you were saying. There is only so much money, and we will get to a point.... The report is showing a loss of three-quarters of a billion dollars within nine years, and it's either going to come from higher taxes or from—we're cowards—other areas. I'd like to hear feedback from you all about what you would see as a priority for your community. Is it cuts in other social areas or changing the way we do postal service?

It will come down to three-quarters of a billion dollars a year across Canada, which is a lot of palliative care, health care transfers, roads, or else maintaining a dwindling postal service that we may not have the courage to address. I'd like to hear about what's more important for your communities.

[Greg Wilson]

I think the way to look at it from a business perspective is that each should be able to stand on its own. If the government feels that it wants to subsidize a higher level of service than what it brings in just to be revenue neutral, then that's its prerogative, of course, but I would think there are ways that people can still get their mail and the cost would be significantly lowered.

I look at community mailbox conversion and I see a $400-million savings. Moving from corporate to franchise is $177 million, alternative-day delivery if $74 million, so on and so forth. That's where I got the $650 million. What you have to subtract from that is the cost to deliver mail to the homes of people who can't get out. I think you would have to incorporate that.

[Kelly McCauley, Conservative, Edmonton West, AB]

No, You're right. The vulnerable have to be looked after. It has to be balanced out against other costs, but that has to be a priority as well.

How much time do I have, sir?

[The Chair, Conservative, Tom Lukiwski]

You have about two and a half minutes.

[Kelly McCauley, Conservative, Edmonton West, AB]

Sir, there about eight posties who work in your riding?

[Sandy Middleton]

Yes.

[Kelly McCauley, Conservative, Edmonton West, AB]

Mr. Wilson, do you have any idea of the number in yours?

[Greg Wilson]

I'm not sure.

[Kelly McCauley, Conservative, Edmonton West, AB]

No. Okay.

Business-wise, we talked about how people would love to get more access to business services. We all want more. Do you think there's an appetite? Yes, give us more, but by the way, we have to pay more.

We heard a narrative from a lot of interested groups saying, “Wouldn't it be great to expand? It won't cost us anything.” We know that's not real.

[Sandy Middleton]

No.

[Kelly McCauley, Conservative, Edmonton West, AB]

Is there a desire to have these services, and by the way, we'll pay for it, or is it recognizing that with scarce resources, we would rather have it for other needs, whether it's roads or better clearing or better access to community mailboxes?

[Greg Wilson]

When the report talked about, say, postal banking, for example, is that what you're...?

[Kelly McCauley, Conservative, Edmonton West, AB]

I mean just in general.

[Greg Wilson]

I think if it can stick to its core competencies of delivering the mail and focus on that rather than trying to expand, that would probably be the most prudent course. Labour costs are so high, compared to many other.... I did not realize the kinds of pension costs and wage costs in government.

[Kelly McCauley, Conservative, Edmonton West, AB]

It's nice these are available, but the reality is that a public service job is taking from one person's pocket and putting it into another's. It would be great if everyone could be a high-paid postal worker, but someone has to pay for it. One job created there means a couple of jobs lost elsewhere.

I appreciate your time. It has been entertaining. Chief Bull, thanks for joining us.

[The Chair, Conservative, Tom Lukiwski]

Thank you very much.

Now we have Mr. Weir for seven minutes.

[Erin Weir, NDP, Regina—Lewvan, SK]

Thank you.

One issue we heard on the previous panel was about how Canada Post was centralizing the sorting of mail and how that is reducing the quality of service. I wonder if you could you talk about that in your communities.

[Sandy Middleton]

In our community, they recently changed sorting to Thunder Bay, and probably in yours as well. I think all of ours in the northwest went to Thunder Bay because someone bought a fancy new machine, and we had to justify buying a machine.

I had in my brief that it was three days, but when I went back and checked, we were told we would still get local delivery in two days. As a municipality, we sent out four or five different mailings at different times and with different-sized envelopes. We tracked how long it took to get them back. Two days was most certainly not the norm.

I think we got one back in two days. I believe it was three days for around 30% of them, but the others took up to eight or nine days. We used to sort mail locally, and I wouldn't be too surprised if we lost one employee when that sorting went away. When we sorted it locally, we did get it in two days.

For anyone to think you can put mail in a truck at three in the afternoon, drive it down to Thunder Bay—about a seven-hour drive—sort it, and get it back and in the boxes the next day in Red Lake, Ontario, is a bit of a stretch. We didn't have a good experience with it.

[Chief Clifford Bull]

When I did speak with the part-time postmaster, she indicated that the premises where we operate our post office are an inconvenience. They have to bring all these postal packages and heavy bags up these stairs to the small cubicle where they hand out the mail. I think that part can be alleviated by ourselves. Leadership probably could find a more suitable location, because the elders have to climb up these stairs, grab their package, and take it back down again, which is hard on them.

I can't comment on the parcelling and that part. I haven't a comment on that.

[Greg Wilson]

I don't have any particular comment.

[Erin Weir, NDP, Regina—Lewvan, SK]

Fair enough.

I want to return to the whole question of postal banking. This is obviously one of the options that's being considered to revitalize Canada Post. I think the idea behind it is that Canada Post has this network of offices all across the country, and it has a presence even in many smaller communities that have been abandoned by the big banks.

When you look at other countries, you see that they have financial services delivered through the post office. It seems to create a lot of revenue for their postal systems.

I think I know where you're at on this, Mr. Wilson, but I will ask the other two panellists to share any thoughts they might have on whether this is an idea worth pursuing.

[Chief Clifford Bull]

I received a letter one time from the liquor control board. They wanted to do some kind of program whereby they would deliver liquor right onto the reserve—as if I needed more social issues to deal with. To me that seemed like bootlegging, but on a legal basis, and I didn't really care for that kind of idea.

I don't know if you ever heard about it. That was something the LCBO thought up, I guess to drum up more business. I was totally against it.

[Sandy Middleton]

If you're in a community that has two banks, would another one help a lot? Probably not, but for sure it would if you were in an area where they have nothing. For the longest time the folks in Ear Falls didn't have a bank. They were 45 miles away. They'd drive into Red Lake for their banking.

I think postal banking would definitely be a positive thing there if it were run as a money-making operation and not at a loss.

[Erin Weir, NDP, Regina—Lewvan, SK]

Thanks.

Mr. Wilson, do you have any further thoughts on the idea of postal banking?

[Greg Wilson]

There are a couple of things I have highlighted on that. Certain countries have embraced it, including Japan, South Korea, China, France, Italy, U.K., and India.

I thought this was an interesting perspective on it:

...in November 2015, Japan sold an 11 percent stake in its postal service, which houses the country’s biggest bank by deposits and its largest insurer. The sprawling operations had become a symbol of government inefficiency and cronyism.

The article was trying to be balanced. It went on to say:

The track record of postal banking suggests a trade-off. Government-run postal banks can be effective in reaching rural and other underserved populations,

—which is what Sandy was saying—

but can also be used to divert savings to investments whose goals are more political than profitable.

That's probably my biggest concern.

Opponents of postal banking argue that getting the unwieldy postal bureaucracy involved in financial services can be a disaster that could stifle startups working to adapt mobile technology and new data tools to serve the unbanked.

There are pros and cons, but I can see that the community hubs model, which is maybe what you're suggesting, could work in certain communities.