Evidence of meeting #115 for Government Operations and Estimates in the 44th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was communities.
A video is available from Parliament.
Assistant Deputy Minister, Policy, Planning and Communications, Department of Public Works and Government Services
In the 16 seconds that are left, we do take a look at the top 12 or 15 other comparable countries. Their post offices are all facing the same challenges as Canada Post, so we're learning from them.
Conservative
The Chair Conservative Kelly McCauley
Thank you very much.
Mrs. Vignola, you have six minutes, please.
Bloc
Julie Vignola Bloc Beauport—Limoilou, QC
Thank you, Mr. Chair.
Thank you, Mr. Ieraci and Mr. Gourevitch.
I believe it was you, Mr. Gourevitch, who answered Ms. Atwin's question about the content of the government's letter of expectation. You said that the government expected Canada Post to meet the expectations of its service charter. Unless I'm mistaken, I believe you were talking about the Canadian Postal Service Charter. However, the Canadian Postal Service Charter dates back to 2018 and was supposed to be reviewed in 2023. Unless I've lost all of my skills for intellectual work, the new version of the charter is nowhere to be found.
When will the new charter be published?
Assistant Deputy Minister, Policy, Planning and Communications, Department of Public Works and Government Services
As mentioned, the Canadian Postal Service Charter is subject to review every five years. The review was initiated this past year and is ongoing.
As you may have picked up from the answers given by our Canada Post colleagues, the charter hasn't changed since 2009. The principles set out in the charter and the services Canada Post must provide to Canadians are relatively stable.
Bloc
Julie Vignola Bloc Beauport—Limoilou, QC
Yes, the corporation's services and obligations are stable, but it's not profitable.
You said earlier that various actions had been taken to improve Canada Post's financial sustainability. You said it was important to leverage synergies across the services available throughout Canada and to undertake other activities to achieve profitability. You didn't provide a list of actions or any details, however.
Generalities aside, can you give us any details on how financial sustainability will be achieved at Canada Post? That's my first question.
Now for my second question. Providing postal services right across the country is a very important responsibility. Nevertheless, all Canada Post receives in government funding is $22 million, basically enough to cover the costs of mailings by parliamentarians and the postage so that all constituents can send letters to their members of Parliament free of charge. That bears repeating because I still see postage stamps on the mail I get from people.
Everyone agrees that Canada Post needs modernizing, but that takes money. Canada Post has a deficit, so it can't undertake modernization efforts on its own, and if it doesn't modernize, it can't make money. It's a catch‑22.
Doesn't the government have a role to play in helping the Crown corporation modernize, thereby helping it to become profitable, even if it's providing sporadic financial support?
Assistant Deputy Minister, Policy, Planning and Communications, Department of Public Works and Government Services
In response to your first question, about wanting more details on the activities, the first thing I would say is that I have to respect Canada Post's independence. As the Canada Post officials mentioned, the corporation's annual report will be released in the next three weeks, if I'm not mistaken. It will contain information on the activities being undertaken, the corporation's financial situation and so forth.
As for your second question, Canada Post does receive $22 million in funding for the activities you described. That said, we are talking about an organization with more than $7 billion in revenue. Does it need money? One thing is for sure: as a Crown corporation, Canada Post receives financial support from the Government of Canada when it cannot finance its activities. The loans it receives come from the Government of Canada.
As far as the future goes, Canada Post will no doubt explore solutions to achieve financial sustainability, given its current business model and the cost of delivering mail and parcels to every community, right across the country. The corporation will certainly explore various options for the way forward.
Bloc
Julie Vignola Bloc Beauport—Limoilou, QC
Modernization is an important element, one that will help keep people in different communities safe, among other things. I mentioned the issues that people in Kuujjuaq and Lourdes-de-Blanc-Sablon were having, but people in so-called rural areas are also having problems. I'm talking about places that fit the definition of a rural area, despite having hardly any of the characteristics and not being remote. Nevertheless, these people run into problems because of duplicate addresses or even postal codes, and that is putting their safety at risk. That's what happens when people don't get their drugs on time. It would be unfortunate if communities decided to take the organization to court for failing to provide the services it is required to provide under the charter and the law.
How are you going to make sure that doesn't happen and that people are safe?
Assistant Deputy Minister, Policy, Planning and Communications, Department of Public Works and Government Services
All right.
The board of directors and the senior management group are responsible for ensuring that the organization does everything possible to deliver services that are in line with current service expectations. That will factor into our conversations with Canada Post regarding the future.
Conservative
NDP
Taylor Bachrach NDP Skeena—Bulkley Valley, BC
Thank you, Mr. Chair, and thank you to our witnesses for being with us.
Does monitoring the effectiveness of the 1994 moratorium on post office closures fall within the mandate of Public Services and Procurement Canada?
Assistant Deputy Minister, Policy, Planning and Communications, Department of Public Works and Government Services
Adherence to the rural moratorium is part of the service charter, and Canada Post provides updates in terms of its compliance with the service charter on an annual basis to the minister through its annual reports. In that regard, my team and I take a look at the annual report and provide a secondary view for consideration by the minister.
NDP
Taylor Bachrach NDP Skeena—Bulkley Valley, BC
Then you do monitor. This is a government mandate. You're the government, and you monitor whether Canada Post, as an arms-length corporation, is fulfilling the mandate. I take that as your answer.
How many post offices have closed since the 1994 moratorium was put in place?
Director, Performance and Impact Analysis, Portfolio Affaires, Department of Public Works and Government Services
When the moratorium was established, there were roughly 4,000 protected offices. Today there are roughly 3,400.
NDP
Taylor Bachrach NDP Skeena—Bulkley Valley, BC
Therefore 600 post offices have closed. From that list of 4,000, we've lost 600 post offices.
Director, Performance and Impact Analysis, Portfolio Affaires, Department of Public Works and Government Services
That's over 30 years.
NDP
Taylor Bachrach NDP Skeena—Bulkley Valley, BC
Does PSPC or the government in general see this as being a problem? There's a moratorium on closing post offices, yet we've seen that a significant percentage of those on the protected list have been closed.
Has the minister provided any direction to Canada Post to reverse this trend? It feels like the moratorium isn't working. I guess that's what I'm trying to say.
Director, Performance and Impact Analysis, Portfolio Affaires, Department of Public Works and Government Services
On an annual basis, roughly 125 offices come up for review. Of those, only a small number are closed, so in over 99% of situations, the moratorium is maintained. However, we absolutely take your point that the number of offices has continued to decline as letter mail does continue to decline as well.
NDP
Taylor Bachrach NDP Skeena—Bulkley Valley, BC
Here's my observation, as someone who represents rural and remote communities.
You have Canada Post post offices in rural areas. Something happens to the post office—the postmaster quits or the postmaster passes away or the building burns down. Canada Post's offer to new postmasters is, frankly, not adequate to attract new people to the role, so when they don't get any applicants, they end up contracting out the service. It's a retail franchise model: They get a business and they pay the business a commission on parcels. When that fails—because the commission that Canada Post pays isn't adequate—the community ends up with a steel mailbox on the side of the road.
Does that ring true? Is that what we're seeing in rural Canada right now?
Assistant Deputy Minister, Policy, Planning and Communications, Department of Public Works and Government Services
Rural Canada, over the last 30 years, has changed fairly importantly. One of the things that was noted is that some communities that were rural 30 years ago are no longer rural. Gatineau is actually still on the list as a rural community. I don't know that many would consider Gatineau to be rural.
I think it's difficult to paint all of them with a broad brush. What I would say is this: In certain instances, because of demographic shifts, there are going to be closures and there are going to be openings that will kind of align as Canadians continue to move throughout the country.
Where there are obviously issues is where, in certain locations, there's still a need for the post office, and the replacement is challenging.
NDP
Taylor Bachrach NDP Skeena—Bulkley Valley, BC
We're talking about 600 post offices, and I'm trying to understand the trend. Those 600 post offices are not in communities that are urbanized. What we're seeing is the loss of post offices in tiny communities. I know we are. You know we are. This is the trend that we're seeing across Canada.
That's clearly contrary to Canada Post's mandate to provide better service in rural and remote communities. We have a situation of the government's mandate not being fulfilled by the corporation. Is that not the case?
The government tells Canada Post, “You need to improve and deliver high-quality postal service in rural and remote Canada,” and Canada Post operates in such a way that we've lost 600 post offices since 1994. Rural Canada is losing postal service every single year.
How is that not a problem?
Assistant Deputy Minister, Policy, Planning and Communications, Department of Public Works and Government Services
Obviously that is a challenge in terms of the number of post offices, including from the moratorium, that have closed. As you indicated, it is 600 over the course of the last 30 years.
Those are the things that are kind of explored through our conversations with Canada Post in terms of raising those challenges and areas that they need to be able to focus their attention on, in terms of making sure they're maintaining service to rural Canadians.
How much time do I have left, sir?
Assistant Deputy Minister, Policy, Planning and Communications, Department of Public Works and Government Services
Very quickly, a number of options are available to ministers of the Crown in terms of their dialogues with Crown corporations. We talked about the letter of expectation being one of them.
The other one is obviously just encouragement, which is what we do within PSPC when we speak with Canada Post in making sure that the board of directors is aware of its obligations in terms of service delivery.