Government Operations Committee on Oct. 17th, 2016

[Dianne Lynn Watts, Conservative, South Surrey—White Rock, BC]

That would be my follow-up question as well.

I would say that it fluctuates through all communities. I mean, our community got hit very hard in terms of the identity theft and breaking in, and all of those things, and then throughout the Lower Mainland.... I guess my point on that front would be in terms of how that's dealt with. I think there have been measures, and Canada Post has worked in taking some measures in that regard.

I'll just flip over to some of the rural areas. Getting back to the opportunity for having a Canada Post with banking and everything else, I think that is just a no-brainer for rural communities. I think that makes sense. In an urban setting, where now you're going to set up banking and start competing with all of the banks in an urban setting, I think it would be very problematic.

I also want to ask...there's been an increase. We've heard this a lot. We hear from the retailers that there's more online shopping. I mean, extrapolate that out. There's more online shopping. The packages have to be delivered to that address or the individual. Are you seeing a spike in that?

I'll ask you, Tim.

[Tim Armstrong]

I'll ask you to rephrase that last bit. You're talking about a spike in what?

[Dianne Lynn Watts, Conservative, South Surrey—White Rock, BC]

I mean in the delivery requirements. If there's an increase in online shopping, which we all know has been significant, obviously on the other end, there would be an increase in delivery.

[Tim Armstrong]

Yes.

[Dianne Lynn Watts, Conservative, South Surrey—White Rock, BC]

What does that look like?

[Tim Armstrong]

There has been a massive increase in parcel delivery through Canada Post because of online shopping. Those revenues have started to exceed the losses related to the decline in letter mail, because there has been a decline, although there is still lots of mail. We've seen that happen. That's one of the most profitable sides of Canada Post.

I'll touch on that again with the CMBs. If people can't get their product right to their customers' homes, and the customers instead have to drive to or walk to some box in all sorts of weather, and hope that the product will be there when they get there, I think the people sending the products are going to find safer, more secure ways of delivering the mail, because if Canada Post isn't going to deliver the mail to your house, then it should probably go out of business.

[Dianne Lynn Watts, Conservative, South Surrey—White Rock, BC]

The problem is—and I think this is one of the reasons it shifted to the boxes—a lot of people aren't home all day waiting for a package. Somebody goes there and there's nobody at home, because people are working, and so now it goes back. People are spending three or four days trying to get the package as opposed to it just being in the mailbox. Do you know what I mean?

I think there has to be some sort of program in place, since we're seeing an increase in the delivery of packages, so that people can get them in a timely fashion. I think the daily delivery is certainly a way to do that.

There are some things I'm hearing. This is just a flag.

[The Chair, Conservative, Tom Lukiwski]

Thank you.

For our final five-minute intervention, Ms. Shanahan, go ahead, please.

[Brenda Shanahan, Liberal, Châteauguay—Lacolle, QC]

Thank you, panellists, for being here today. It's very interesting to hear what you have to say.

It is my first day on this travelling committee, so I want to come back to a very basic question for each of you. Do you see Canada Post as a service or as a business?

I'll start with Ms. Huberman.

[Anita Huberman]

I actually see it as a business. Especially when we're living in a new economic paradigm with new social paradigm needs, we have to think of all entities, even those in government, as businesses. It can just break even, but I think we have to think of new ways of doing business and of delivering mail.

You are trying to fulfill your mandate of mail service to Canadians, but you need to do it through innovative methods, and make sure that your costs are covered, that you are deriving revenue, and that you're also saving for future investments.

[Brenda Shanahan, Liberal, Châteauguay—Lacolle, QC]

Thank you.

Ms. Stern.

[Pamela Stern]

I would say Canada Post is a service and should be a service. If it makes money, that's wonderful, but if Canadians are going to get equitable service, then they need to have equitable pricing. Canada Post needs to be seen as a service rather than as a revenue generator.

A quick way to lose support for Canada Post is for it to be seen as a revenue generator for other parts of the government. We can look at the way people feel about BC Hydro, for example, which is not simply working on cost recovery but is pouring money into the general fund of British Columbia. People are unhappy with BC Hydro.

[Brenda Shanahan, Liberal, Châteauguay—Lacolle, QC]

That's interesting. Thank you.

Mr. Armstrong.

[Tim Armstrong]

The union would believe Canada Post should be operated as a service first, but naturally it can be run as a business to make sure it's making money and staying sustainable, etc.

Again, what are the profits for? Where do they go? I mentioned that Canada Post has given $1.5 billion in taxes and dividends to the government since 1991. Maybe those dividends could be put back into expanding services to Canadians and finding efficiencies in the operations.

I think it should be service first and business second. One of the reasons the union supported converting Canada Post to a crown corporation back in the 1980s was to allow it to operate more efficiently and sustainably in the long term. Its track record, according to the profit statements from its own records, shows that doing that was a huge success.

[Brenda Shanahan, Liberal, Châteauguay—Lacolle, QC]

Therein lies the rub: we're getting business, service, and then a combination of the two, and somehow we have to find the balance. Also, we're dealing with a business environment that is changing extremely rapidly.

We've heard testimony about the services that Canadians appreciate from Canada Post and about some of the challenges and some of the things that are working or not working. What about thinking out of the box now? What kinds of services could we expect from Canada Post, whether that's a service, a business, or a combination of both, Mr. Armstrong?

[Tim Armstrong]

I think it's important that we look to what's happened in the world. Again, Canada Post—and Canada—had a successful postal bank since before Confederation, until 1968 when it was shut down. Other countries in the world have had postal banks for decades. Those that haven't have started them up as a way to diversify and bring in more revenue. That's been very successful. I think of Portugal and Morocco as two recent examples of that.

[Brenda Shanahan, Liberal, Châteauguay—Lacolle, QC]

Is there anything else? You spoke about the postal banks. Is there anything else?

[Tim Armstrong]

Well, again, I guess, like The UPS Store, it's about making sure—that was asked earlier—that our retail networks have products and services that people can use to package and deliver items to Canadians. Whatever you need, when you walk in that store, it should be a one-stop shop, from buying the gift to having it packaged, putting a stamp on it, and maybe even having it wrapped for you. There are all sorts of services like that besides the coins and other things. Also, we have other ideas around providing broadband services.

[The Chair, Conservative, Tom Lukiwski]

We'll have to get those ideas at a later date.

I will say this to all of our panellists. Number one, thank you very much for taking the time out of your very busy schedules to be with us today. Should you have additional information you wish to give to our committee that can help us in our deliberations, please feel free to submit that directly to our clerk. It will form part of the package of information that we will be receiving from across the entire nation.

Finally, we will be making a report to Parliament. I believe that will be tabled probably somewhere towards the latter part of November, or certainly no later than early December. If you do have additional information, I would ask that you get it in within the next couple of weeks. I would appreciate that very much.

Once again, thanks to all of you for being here.

The meeting is adjourned.