Evidence of meeting #13 for Government Operations and Estimates in the 42nd Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was corporation.
A recording is available from Parliament.
President and Chief Executive Officer, Canada Post Corporation
As we mentioned, the issues and challenges will not go away, so the cash generation ability of the corporation won't work back to financial self-sustainability until we have a set of options that can balance the books.
Conservative
Kelly McCauley Conservative Edmonton West, AB
Okay. You also suspended or eliminated the price increase on stamps I heard for this year.
President and Chief Executive Officer, Canada Post Corporation
We have suspended that.
Conservative
Kelly McCauley Conservative Edmonton West, AB
How much is that going to cost us, and by “us” I mean Canada Post, the government, taxpayers eventually? What will that cost us in a 12-month period?
President and Chief Executive Officer, Canada Post Corporation
The annual impact of that is roughly $30 million.
Conservative
Kelly McCauley Conservative Edmonton West, AB
And the general suspension of the five-point plan, switching over to community mailboxes, how much will we add to our collective debt from that in a one-year period, assuming there'll be time for review, etc.?
President and Chief Executive Officer, Canada Post Corporation
Canada Post had $700 million to $900 million savings from our transformation plan. We reported in our annual report that we had achieved $390 million of savings from that plan.
President and Chief Executive Officer, Canada Post Corporation
So the balance of the savings that were projected will be on hold until such time as we have a new plan.
President and Chief Executive Officer, Canada Post Corporation
About $400 million to $500 million.
Conservative
Kelly McCauley Conservative Edmonton West, AB
We've heard different numbers about how many people get door to door. I'm blessed right now, I do, but in the past I've done community. It shows 27% are door to door.
President and Chief Executive Officer, Canada Post Corporation
That is correct; 27% is door to door. The remainder receive their mail....
Conservative
President and Chief Executive Officer, Canada Post Corporation
Yes. No door. It will be some form of centralized delivery, which is a more efficient method of delivery for us.
President and Chief Executive Officer, Canada Post Corporation
So 73% is some form of centralized or group mailbox or rural mailbox, and 27% of Canadians receive door to door.
Conservative
Kelly McCauley Conservative Edmonton West, AB
Is it fiscal year end where the pension holiday ends and you have to start contributing?
President and Chief Executive Officer, Canada Post Corporation
Yes. Canada Post has the calendar year.
Conservative
Kelly McCauley Conservative Edmonton West, AB
How much are we on the hook for on your bottom line then if you have to start contributing?
President and Chief Executive Officer, Canada Post Corporation
It's difficult to estimate; I mentioned the interest rate variation....
Conservative
Kelly McCauley Conservative Edmonton West, AB
Just give us a ballpark figure. How much were you contributing per year before the pension holiday started?
President and Chief Executive Officer, Canada Post Corporation
We had contributed and then we used some other instruments. We contributed close to $1 billion in special payments prior to the holiday close.
Conservative
Kelly McCauley Conservative Edmonton West, AB
All things being equal, our bottom line next year will show minus.
President and Chief Executive Officer, Canada Post Corporation
I think it's a cash generation issue versus a profit and loss issue. It's more balance sheet and cash generation.