Government Operations Committee on Oct. 21st, 2016

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

Thank you.

Go ahead, Mr. Sosa.

[Carlos Sosa]

I would also recommend postal banking. I think it can certainly work. The studies show that.

In this city, we have seen a lot of banks closed. In fact, in my own area, when the CIBC closed in 2000, you saw four payday loan companies open up. Two of them closed, and there are now two open. However, that's an example of where postal banking could work, and especially in areas which are underserved by banks. I mean, this is a way that a public service could provide a critical service in areas that really need it.

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

Thank you, Mr. Sosa.

Another point I've heard from the business sector, commercial customers, and municipalities and users—people who are receiving—is that not one size fits all. When it comes to the issue of door-to-door delivery, community mailboxes, or picking up at a postal counter, it's different strokes for different folks, it seems.

The theme that seems to come out is communication of how delivery is going to be done or changed, and consultation.

Could I have your remarks on that, Mr. Rebeck. What has your experience been?

[Kevin Rebeck]

I think that particularly in urban centres, people who have had door-to-door delivery services should continue to have it. There have been community mailboxes in some of the farther rural areas, but in most places people rely on door-to-door delivery. Stripping that away from them and eliminating that is causing a real problem and concern, and it's something that needs to be restored and reinvested in.

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

Do you think it would be helpful, though? Something we have heard is that in some areas where the community boxes have been installed, it has been a saving. It's not an issue for people in other areas. Recognizing that there is new community development going on, it's something that's accepted.

What would make the difference to you? Would it be if people were consulted beforehand, if municipalities were consulted? Would that be—?

[Kevin Rebeck]

I think the individuals living in the area absolutely need to be consulted and I think as a matter of fairness it should be there for people.

When we say it's being accepted in new developments, I think it's because they aren't being given much of a choice there, but they should be given that choice and be given that opportunity to get their door-to-door service.

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

Okay. Thank you.

Mr. Chair, how much time do I have?

[The Chair, Conservative, Tom Lukiwski]

You have a little less than two minutes.

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

Mr. Sosa, I was interested to hear your reactions as well, as representative of your association, to the announcement of community mailboxes being put in. Was there any discussion whatsoever prior to the mailboxes being put in?

[Carlos Sosa]

In 2013, we received really no new approaches from the management at Canada Post. It was only basically in January 2014, where we were called to a meeting with Deepak Chopra and Susan Margles and Jon Thompson of Canada Post.

They have consulted with us, yes, but it appears that the consultations have been more of an act of public relations than real consultations. A great example would be the medical form that they released in 2014. They said they consulted with us, but they did not, nor did they mention that they were coming out with a medical form even prior to their announcement in summer 2014.

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

Thank you for that.

[The Chair, Conservative, Tom Lukiwski]

We will now go to Monsieur Clarke. Those of you who do not speak French may want to put on your interpretation devices.

Mr. Clarke, you have seven minutes.

[Alupa Clarke, Conservative, Beauport—Limoilou, QC]

Thank you, Mr. Chair.

I'll start with you, Professor Camfield. Do you see Canada Post as a national symbol of federal unity?

[Prof. David Camfield]

Yes.

[Alupa Clarke, Conservative, Beauport—Limoilou, QC]

That’s wonderful.

I understand what you are saying and it may even be the truth. In your opinion, the members of the task force did not have the knowledge required to accomplish their task, and they promoted a certain vision, a certain model.

However, what do you have to say about their accounting work?

[Prof. David Camfield]

I have to apologize. I'll speak in English.

I'm not convinced by the analysis in the report on that question. It really strikes me that when I look at the fiscal side, I find the analysis produced by the union to be more persuasive, given the demonstrated track record of profitability over the previous two decades. It appears to me that the task force report is a bit of a crisis-mongering. It seems to suggest a pessimistic vision in order to justify a certain process of restructuring, and I just don't find it persuasive.

That's not to suggest that there aren't changes in the environment in which Canada Post operates, but I just don't find the report to be plausible on that.

[Alupa Clarke, Conservative, Beauport—Limoilou, QC]

For example, the task force suggested that the deficit could reach $700 million by 2026. That figure was produced, analyzed and confirmed by Ernst & Young. So it wasn’t the members of the task force per se who reached those conclusions. In that case, would you say that Ernst & Young also has a worldview that promotes privatization?

[Prof. David Camfield]

Again, the questions would be, what were the assumptions, and what's the period over which one's calculating the financial performance of Canada Post? I don't think a short-term window of one or two years is appropriate. I think it does need to be looked at over a longer time period, and we have to be cautious about projections forward, of course, because forecasting is always a very difficult exercise.

[Alupa Clarke, Conservative, Beauport—Limoilou, QC]

Okay.

In this committee, I have learned that Canada Post provided banking services until 1968. Do you know why the corporation cancelled that service? Can you tell us about it?

[Prof. David Camfield]

I'm not an expert on the postal banking at that level of detail; I'm sorry.

[Alupa Clarke, Conservative, Beauport—Limoilou, QC]

Okay.

However, you did say that providing banking services would be a good initiative.

[Prof. David Camfield]

I think, based on the European experience and the experiences of other countries, that it's an option that certainly should be seriously considered. I would raise the question about the need for a serious, independent assessment of the prospects of postal banking and not be overly swayed by the perspectives of the banks or financial institutions themselves, since they have a vested interest in avoiding additional competition with at least one sector of the market that they might be sensitive to competition in.

[Alupa Clarke, Conservative, Beauport—Limoilou, QC]

Thank you very much, Professor.

My question is now open to everyone. Any of you can answer.

If we opt for banking services, Canada Post’s 50,000 employees will have to be trained, so that they can provide that type of service. That surely would cost astronomical amounts. Who do you think should pay for the training of those 50,000 employees?

A very significant amount of money, perhaps around $500 million, would also have to be invested to set up the service. Two weeks ago, one of my colleagues mentioned that figure. In your opinion, where should the money come from to launch the banking service?

We can perhaps start with Mr. Rebeck.

[Kevin Rebeck]

Sure. It wouldn't be 50,000 workers who would need that training. Many of the Canada Post employees are door-to-door delivery people and out on the street. You'd need to train the people who are in the postal offices themselves, and that would be an investment that invests in the training and skill set of our Canadian workforce, which I think is money well spent. Those resources would come from the new revenue streams and dollars that we'd be generating, so I think that there's a lot of opportunity there for growth—growth for the community, growth for skills, growth for development—and it will pay for itself.

[Alupa Clarke, Conservative, Beauport—Limoilou, QC]

Mr. Sauer, you have the floor.