Government Operations Committee on Oct. 19th, 2016

[The Chair, Conservative, Tom Lukiwski]

Ladies and gentlemen, we'll begin. It's 10 a.m.

Welcome to our panellists. Thank you very much for being here.

As you know, the minister responsible for Canada Post, the Hon. Judy Foote, has initiated a very extensive consultation process dealing with the future of Canada Post. There are two phases. Phase one was the establishment of a task force whose mandate was to examine the financial viability and sustainability of Canada Post. The task force has completed their work. They've submitted their report. We've actually had a chance to interview and question the task force.

This is phase two, and that's why you're here today. Phase two is a cross-country tour, talking with Canadians, organizations, and municipalities about their views on the future of Canada Post. More importantly, we hope to get suggestions from you as to what you see Canada Post's future to be and how it can perhaps continue on in the vein we've seen for the last century.

The process here is very simple. We're going to ask each of you to give a quick opening statement. When I say “quick”, I mean five minutes or less. That will be followed by a series of questions and answers from all our committee members.

With that brief introduction, we'll now go to my list, which has, first, Mr. Lambrecht. The floor is yours, sir, for five minutes or less.

[Alexander Lambrecht, President, Northern Territories Federation of Labour]

Thank you very much to the committee. Welcome to Yellowknife. I hope you enjoy your very short visit here.

The Northern Territories Federation of Labour welcomes the opportunity to provide input on the Canada Post review. I'd like to just recognize first that we are on the traditional land of the Dene people. Mahsi cho. We thank them for that.

The NTFL was founded in 1980. We have more than 10,000 affiliated members from more than a dozen unions in the Northwest Territories and Nunavut. We work to advocate for and protect workers' rights and interests in the Northwest Territories and Nunavut, including the security and welfare of all people; to protect and strengthen democratic institutions and secure full recognition of the enjoyment, rights, and liberties to which we are justly entitled; and to promote the causes of peace and freedom in the world.

We understand that the committee has been appointed to collect input and information and to identify options for the future of Canada Post in order to help the federal government attain its goal of ensuring that Canadians receive quality service from Canada Post at a reasonable price. The NTFL is especially interested in protecting workers' rights, ensuring the sustainability and enhancement of public services, and levelling the playing field across all industries to eliminate greed and self-interest, which are not in the public's best interest.

Canada Post has made profits 19 out of the 21 past years. Just last year it netted almost $100 million in profits. There's no reason those profits shouldn't be invested back into our communities. Canada Post ultimately is a public service that can do more with its vast network. Let's not shut the doors on Canada Post and its potential.

Without going too much into technical detail, I'm just going to hit on a couple of key items that I feel would really benefit the north, both the Northwest Territories and Nunavut. I get a lot of this from a “Labour Views” column that I wrote back in June, which was in our local newspaper. It was going over a history of Canada Post. I don't feel that a lot of Canadians realize the vast history that Canada Post has in this country, especially in the early days.

In 1981, when the Canada Post Corporation Act came into effect, it demolished the Post Office Department of Canada. Since then, Canada Post has evolved and modernized its operations. However, over the last few years many tactics have been employed by Canada Post to reduce expenses, increase revenues, and eliminate the services that Canadians and businesses depend on to receive their mail, such as bills, pension cheques, letters, packages from friends and families, and so on. Despite these tactics, the workers at Canada Post have remained committed to ensuring that Canadians receive the highest quality public service possible, but not without challenges from Canada Post in its efforts to try to deceive Canadians through campaigns feigning financial difficulties despite continuing to be profitable year after year.

What can we do to help save Canada Post and create services to help out Canadians who live in remote regions? In the Northwest Territories and Nunavut we have 58 communities—33 in the NWT and 25 in Nunavut—that are fly-in communities. The one thing that not every one of those 58 community in the Northwest Territories and Nunavut has is a banking outlet. The one thing that Canada Post could bring to a lot of northern remote communities is affordable, accessible postal banking, something that currently does not exist in a lot of the small communities.

The other thing we've noted about how postal banking would benefit a lot of the smaller jurisdictions is especially in helping people in lower income situations, indigenous and rural residents, and migrant workers, as well as people who are forced to use payday lenders or are forced to pay high fees at regular big banks.

One thing we want to see is that Canada Post should release the study unredacted so that Canadians can see what the true benefit of Canada Post could be.

I'm going to end there.

[The Chair, Conservative, Tom Lukiwski]

Thank you very much, Mr. Lambrecht. As we discussed earlier, I'm sure many of the other points you have in your presentation will come up during questions and answers. Plus, your presentation has been submitted to the committee, and it will help form part of our final report.

Next up we have Mr. O'Reilly.

Mr. O'Reilly, you have five minutes, please.

[Kevin O'Reilly, Member of the Legislative Assembly, Frame Lake, Government of the Northwest Territories]

Thank you, Mr. Chair.

Welcome to Yellowknife, everyone.

I've been a resident of Yellowknife for over 30 years. I have served on Yellowknife City Council. I am currently a member of the Legislative Assembly here for the Northwest Territories, representing one of seven Yellowknife ridings. I have personally visited 29 of the 33 communities here in the Northwest Territories. I am a long-time philatelist, or postal historian, a member of several philatelic organizations, and I currently serve in a volunteer capacity with The Royal Philatelic Society of Canada. I am on the board of the Postal History Society of Canada. Although I don't speak on behalf of these organizations, I did consult with them in terms of preparing my speaking notes today.

I also served on Canada Post's stamp advisory committee for six years, and I have authored many articles on the postal history of northern Canada and exhibited nationally and internationally. I have attached a philatelic resumé with my speaking notes and have provided that to your clerk.

I have a couple of main things that I'd like to talk over with you today. First, the importance of the public postal system in the Northwest Territories, and then I have a few remarks about support for organized philately in Canada.

I'll say a little bit about the importance of a public postal system for the Northwest Territories. As the previous speaker mentioned, we have many rural and remote communities here in the Northwest Territories, some that are not connected by roads. Several of our smaller communities still don't even have post offices, and I'll give you a couple of examples. The Hay River Reserve has 325 people, and no post office. Edzo, about an hour away from Yellowknife, has about 500 people, and they don't have a post office.

In any event, I know that Canada Post has a universal service obligation, and I think there is really a need to keep Canada Post in the public sector to ensure that all our northern residents have access to universal and affordable services.

The previous speaker also mentioned the lack of banking facilities in many of our smaller northern communities, and I think this is a void that Canada Post can and should fill.

I think there is also a role for Canada Post possibly in revitalizing the nutrition north program. Previously we had a food mail program here that covered northern Canada. It's been changed now to a retail subsidy program, but I think that, in revitalizing more affordable food for the north, there may be a role for Canada Post to support that.

I'd like to move on to support for organized philately if I can, Mr. Chair. I reviewed the 2015 annual report for Canada Post Corporation, and I could only find one line item that says “other” for $518 million. I couldn't actually find what the philatelic revenues are for Canada Post. I looked at the task force report, and the word “philately” doesn't even appear anywhere in the report.

I think there is a need for Canada Post to reinvest in organized philately in this country to help promote Canada around the world and to help celebrate our heritage. In my opinion, there has been a very limited reinvestment of philatelic revenues back into the hobby of specialized or organized philately. At the local level it would be helpful for post offices to stock commemorative stamps and to make sure that philatelic mail is properly cancelled at the regional and national levels. There are four or five national stamp shows. and it would be great if we could get Canada Post to actually have tables where they could sell material.

At the international level, Canada used to host international stamp shows. We had them in 1951, 1978, 1987, and 1996, all in Toronto, but we haven't had one since. It's partly because of the lack of support from Canada Post.

I was at an international stamp show in New York in May of this year. There were 250,000 people who went through the doors over eight days, and I think it brought tremendous economic benefit to the city.

I'd be happy to answer any questions you may have, and I have given a written version and an electronic copy of my submission to your clerk.

Merci.

[The Chair, Conservative, Tom Lukiwski]

Thank you very much.

Finally we have Ms. Lefrancois for five minutes, please.

[Lynda Lefrancois, President, Local 858, Yellowknife, Canadian Union of Postal Workers]

Good morning. I'm Lynda Lefrancois. I am the president of the Yellowknife local of the Canadian Union of Postal Workers. I've worked for Canada Post for almost 22 years.

I've seen many changes over the last 22 years. The union is not opposed to change and growth. What we question is Canada Post's focus on profit at the expense of providing service to the people of Canada.

Canada Post is a public service. Its mandate is to be self-sustaining. Canada Post is ignoring the employees' input into achieving this goal.

Canada Post is a service—a highly profitable service that almost all Canadians have used and need. It is used from coast to coast to coast. Here, in the vast north, Canada Post is a lifeline. We depend on postal service more than many other places in Canada do. It is a service that is required for business and needed for everyday living. We dispatch mail and parcels every day to the northern communities. I have personally dispatched 4,500 pounds in one day. That's over two tonnes of mail. That was during the summer, not during the Christmas rush. More mail comes into the north from the rest of Canada than the north sends out.

Revenues are needed to sustain any business. Since we are in these communities, why don't we expand our service? We can provide customers with services that aren't available to them or improve the services.

The question of closing corporate offices has been raised. When this happens, it is devastating to the employees and the communities. There is a big difference between a corporate office and a franchise retail outlet. One difference is our training, knowledge, and experience. A Canada Post employee usually is a lifetime employee. Franchises experience a high rate of employee turnover, which affects service.

At a corporate office, we educate and inform our customers so that they can choose what service best meets their needs. My 15-year experience as a retail clerk has taught me that if you give the customers the best value for their hard-earned dollar, they will be back. At a corporate office, we don't just sell the highest-priced product or service. From my experience, the private franchises don't inform their customers of the range of options and sell them the most expensive product.

Seniors and those with disabilities who find it too difficult to use franchise outlets need corporate offices. Because of our years of experience and knowledge, we can assist them and provide them with quality service. We know our customers and anticipate their needs. Because of this, not only do we generate repeat revenue, but we also help them keep their independence.

In my office, we have a much larger retail space than the franchise outlets, whose counters are stuck somewhere in the back corner of the store. Why are we not utilizing this space to expand services and generate more revenue? There are a lot of services not readily available in northern communities that the post office could easily provide.

For example, let local artisans display and sell their wares. We are already helping the tourist industry by giving directions. Why not partner up with other businesses and sell tickets to events, shows, and tours?

The post office is a public space, so utilize it. Let us offer other government services to fill the needs of the communities. Why not expand our identity verification service to federal and provincial governments and to businesses?

In most places, the post office is in the centre of the town, so why not make it the community hub?

There are other possibilities for service expansion. Why can't Canada Post offer a service to help people move their household? There is great potential to provide this service to families, those working away from home, and students. I have seen the opportunities for this service with my own customers.

Canada Post has been self-sustaining, year after year, and always making a good profit. It is time to take these profits and reinvest them in new services that will generate revenue. It is time to bring back services such as the food mail program and postal banking, which will greatly help the people of our northern communities. It is time to provide services such as broadband Internet, which will help connect isolated communities with the world.

This will not only let Canada Post retain its long-treasured service but allow it to grow and thrive. All Canadians will reap the benefits.

I wish I could cover more important issues, but it's not possible in this short time.

I thank the committee for your time and consideration, and I urge you to please give these issues the attention they deserve.

[The Chair, Conservative, Tom Lukiwski]

Thank you very much.

Thank you to all panellists for being succinct and abiding by our five-minute time limit.

We'll now go into our question and answer section.

Mr. Whalen, you're up, for seven minutes, please.

[Nick Whalen, Liberal, St. John's East, NL]

Thank you very much, Mr. Chair.

Thank you, all, for coming today and for your impassioned defence of Canada Post and the important role it plays in rural life.

We've seen that across the country there is a real difference in the way in which Canada Post is used by different communities, urban, suburban, rural, and far rural communities like your own.

My first question goes along the lines of your notion around the profits and then how Canada Post has been managed. It seems to me that we've lived now through a few years of the postal transformation, the sort being centralized, a certain number of community mailboxes. Doesn't management deserve some credit for having helped generate these profits in a downturn in the use of letter mail delivery? Hasn't the transformation actually allowed these profits to be earned?

This is a question for Lynda and Alex, who wanted to raise profit as one of the key points in their address.

[Alexander Lambrecht]

Interesting. I've had questions like that come up quite a bit over the last couple of years in this business. How much credit is management in business due for the work they do? I would say, to some extent, yes, everybody deserves credit for the work they put in to it, but we only have to look at the decisions they didn't make where improvements and other benefits could have been brought in had they made other decisions or put other criteria or other priorities higher up on the ladder rather than just being concerned about the overall profits. Being sustainable, yes; economic downturn, difficult; but ultimately there are many ways to do the same thing to provide a greater benefit and better services.

[Nick Whalen, Liberal, St. John's East, NL]

Ms. Lefrancois, how do you feel about the focus, the sensibility to profit?

[Lynda Lefrancois]

Profit, yes, they make a profit. Yes, they are business people, and they know how to run the business. I don't want to turn this into the union against the corporation, but basically use our ideas. Yes, times have changed. We've gone to the digital age. Letter mail is down and parcels are up. But things like quick-cutting the staff and making everybody part time, making us—and I'll tell you right now—overworked, you saw how much mail I moved in one day during the summer physically.... But we have come up with the ideas. Yes, you need the revenues. You need to generate revenue, but use our ideas. There are good brains on both sides. Get together and generate some more of these revenues so everybody grows on both sides so it's profitable for us employees, profitable for the corporation, and benefits the Canadian public.

[Nick Whalen, Liberal, St. John's East, NL]

One of the recommendations that the task force came up with was around synergies and further integrating productivity gains with Purolator. Do you think that's a good way for the corporation to achieve some of those productivity gains you are talking about, or are you talking about different types of productivity gains?

[Lynda Lefrancois]

It's different for us, because right now Purolator doesn't serve us here in the north. Purolator stops in Yellowknife, so that's not going to work. FedEx stops in Edmonton, so that's not going to work. It's us, as Canada Post employees, who do it all.

[Nick Whalen, Liberal, St. John's East, NL]

The task force also talks about further streamlining processing operations as a potential way to save $66 million a year. Is that the type of productivity gain you're talking about? Was the union consulted by the task force about the types of improvements in operations that could allow these savings to be made?

[Lynda Lefrancois]

That I don't have the answer to, but as far as the employees go, don't cut the employees. Don't mainstream them because that is not going to work. We break down. We're human, so don't keep cutting us and cutting us. Let us grow and everybody else benefits. The community benefits by the employment all around. If you get rid of the employees and everybody becomes mechanical or you get machines to do all the work, it's going to break down.

[Nick Whalen, Liberal, St. John's East, NL]

We want to have good quality jobs for Canadians. We're not trying to eliminate the workforce entirely.

Mr. O'Reilly, you said you have been to 29 of the 33 communities in the Northwest Territories. That's impressive.

How many of these communities are missing postal outlets? You mentioned two but do you have a number on the rest?

[Kevin O'Reilly]

Sure. It's in my speaking notes, but to summarize, Dettah's population in 2015—and it's across the bay from Yellowknife here, about a 25-kilometre drive away—is 252 people; Edzo has about 500 people, and it's about an hour away; Enterprise, which is on the road south of Hay River, has 115 people; Hay River Reserve has 325 people; Jean Marie River has 84 people; Kakisa has approximately 50 people; and Nahanni Butte has 94 people. I think there are seven communities that—

[Nick Whalen, Liberal, St. John's East, NL]

Do those communities have other types of retail businesses or other community hubs in them that could serve as a host for a franchise operation for Canada Post?

[Kevin O'Reilly]

Yes, absolutely. There is either some sort of a grocery store, a co-op, or a gas station. There are facilities in every one, or even a community office, or a band council office where there could be a corporate outlet.

[Nick Whalen, Liberal, St. John's East, NL]

Is there an operation to move some type of a franchise into those?

[Kevin O'Reilly]

Yes. I don't know how Canada Post makes these decisions. They have opened up offices in the last five or 10 years in a couple of the smaller communities: Colville Lake and Trout Lake. The fact that some of our communities still don't have access to proper postal service, I think, is an issue here. In terms of banking, and I mentioned that, there are very few communities that have a bank.

[Nick Whalen, Liberal, St. John's East, NL]

On the banking, my cellphone is my bank now. I very rarely go to the branch. I can cash my cheques, I can make my wire transfers, and I can pay my bills. Very rarely do I need to go to a branch to do business. Is it feasible for people in the north to use their cellphones to do all their banking? Do people have access to proper cell service? How could Canada Post facilitate access to the modern world for rural people in the Northwest Territories so they can access the services that people from urban Canada access?

[The Chair, Conservative, Tom Lukiwski]

We're basically out of time now.

[Kelly McCauley, Conservative, Edmonton West, AB]

You can take my time to finish up.

[Kevin O'Reilly]

We don't have cell service in all the communities here, of course, and we don't have high-speed Internet in most of the communities here. The Internet was out here this morning. I'm trying to do work over in the assembly and it was out. Our service is not very reliable, and it's too expensive compared to most other parts of Canada. I don't think we're at a point where people can do adequate banking online.