Evidence of meeting #41 for Transport, Infrastructure and Communities in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was post.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Gwyneth Howell  Executive Director, Canadian International Mail Association
Deborah Bourque  National President, Canadian Union of Postal Workers
Evan Zelikovitz  Consultant, Public Affairs, Canadian International Mail Association
Gordon Taschuk  General Manager, Kirk Integrated Marketing Services Ltd., Canadian International Mail Association
Moya Greene  President and Chief Executive Officer, Canada Post Corporation
Gordon Feeney  Chairman of the Board of Directors, Canada Post Corporation

5:20 p.m.

President and Chief Executive Officer, Canada Post Corporation

Moya Greene

I believe it was about 55% failed on the first go, but depending upon the route, some portion of that 55% that failed on the first go could be made safe by customizing a little bit, by moving the box a little bit. So that's not the ultimate number. In some cases, with a more precise safety tool, we're seeing that about 68% of the boxes are safe. Now mind you, that's a small sample of the 840,000, from a traffic safety point of view.

5:20 p.m.

Liberal

Don Bell Liberal North Vancouver, BC

Okay.

Now to the question on remailing. Can you compete with the private remailers' rates at what they charge now? When you say it's $70 to $80 million profit—

5:20 p.m.

President and Chief Executive Officer, Canada Post Corporation

Moya Greene

No, $70 million to $80 million of revenue.

5:20 p.m.

Liberal

Don Bell Liberal North Vancouver, BC

Of revenue.

5:20 p.m.

President and Chief Executive Officer, Canada Post Corporation

Moya Greene

It's probably $40 million of profit.

5:20 p.m.

Liberal

Don Bell Liberal North Vancouver, BC

Can you compete with their rates?

5:20 p.m.

President and Chief Executive Officer, Canada Post Corporation

5:20 p.m.

Liberal

Don Bell Liberal North Vancouver, BC

So do you believe that the volume of remailing will drop because the rates will go up and then companies will not come into Canada to have it done here or will ship it and will not do this?

5:20 p.m.

President and Chief Executive Officer, Canada Post Corporation

Moya Greene

No. What the remailer does is they pick up commercial mail in Canada, they induct it in a foreign post. They improperly use universal postal organization rates that apply to third world countries, which are lower, in order to offer a lower price in Canada. So on the basis of informal discussions I had with some of the foreign posts that are the remailers, I think they will exit the market as the Supreme Court has told them to do.

5:20 p.m.

Liberal

Don Bell Liberal North Vancouver, BC

Okay. My final question is—

5:20 p.m.

President and Chief Executive Officer, Canada Post Corporation

Moya Greene

We end up having to deliver the mail.

5:20 p.m.

Liberal

Don Bell Liberal North Vancouver, BC

Okay. I've only got two minutes.

I'm going to follow up on Mr. Lemay's question. I think it was Mr. Lemay. He asked about closing post offices, and the one he referenced was closed even though it was profitable. Is there a minimum profit or an average profit? In other words, if it makes a dollar in the year and it doesn't cost you anything, why not keep it?

5:25 p.m.

President and Chief Executive Officer, Canada Post Corporation

Moya Greene

Because the cost structure of the company is very, very high. And as you know, we only make--even with the subsidiaries--2% earnings before tax as a very, very capital-intensive business with sorting equipment that is five generations old, with the network of facilities that we have, with the network of retail outlets we have, with the operating procedures we have--

5:25 p.m.

Liberal

Don Bell Liberal North Vancouver, BC

Okay, I hear you.

I've got to turn my time and share it here.

Thank you.

5:25 p.m.

Liberal

Mauril Bélanger Liberal Ottawa—Vanier, ON

I'll make an observation on this.

My first observation is that I believe in the necessity of what you call reserve market, or what I call exclusivity, if indeed you have the obligation of a universal service. With what I've heard today about this clash of perceptions, were I in the shoes of the management of Canada Post I would perhaps do a hell of a lot more than what's being done now to make sure that the universal delivery includes rural service and get over this hump fast; otherwise, the universality will be jeopardized because the exclusivity is going to be jeopardized.

My question relates to the C.D. Howe Institute commentary. Who initiated this? What was the impetus for this? Who is behind this? That's an important question, because to the objective observer this is the first stab at privatizing Canada Post. It's important to know who initiated this study.

5:25 p.m.

President and Chief Executive Officer, Canada Post Corporation

Moya Greene

I think the C.D. Howe Institute looks at all kinds of issues pertaining to public ownership and regulation of markets and markets that are protected. I don't think it's a necessarily adverse thing to have a discussion in this day and age about those markets.

As you know, Monsieur Bélanger, a lot has changed in the world in the past eleven years. Europe has liberalized its market, some postal administrations have changed their corporate structure, and others have approached liberalization in different ways from what we have. I don't think it's a bad thing that the C.D. Howe Institute, which is a very reputable organization, would raise the profile of these issues.

5:25 p.m.

Conservative

The Chair Conservative Merv Tweed

Thank you, Ms. Greene.

Mr. Chong, last comments.

5:25 p.m.

Conservative

Michael Chong Conservative Wellington—Halton Hills, ON

Thank you.

I have two questions and other comments to make.

My constituents are very upset, as am I. In our part of Ontario, in southwestern Ontario, we do not have much federal government presence. As a matter of fact, we have almost no federal government presence except for Canada Post, and Canada Post is failing in its obligation to deliver mail to rural mailboxes.

It's the sole presence of the Government of Canada, and we can't get it done. Frankly, it is an embarrassment. It is one of the most basic elements of a civilization, and I'm not one who's lent to hyperbole. The ability to carry messages from point A to point B efficiently and accurately has been the hallmark of civilizations for millennia, and we can't seem to do it.

I would also remind you that I hear all this talk of profit and the like, and having come from the private sector, I will tell you that you are not a for-profit private corporation. I really don't care about EBITDA. You have a single shareholder--that is the Government of Canada--and you have a monopoly. You have a sacred trust. The government has given you a monopoly--Canada Post--and in return, we expect that services will be delivered on less profitable routes, on routes that are far-flung in this country, in places like Nunavut, the Northwest Territories, Yukon, and rural mailboxes. We expect universality, and we expect the rural mail to be delivered. But if you break that sacred trust, then frankly I'm not sure why we have a monopoly.

I am one of these parliamentarians who believe in public delivery of services. I believe that crown corporations and the public service have a role to play in delivering services that Canadians need. But frankly, when I see what's going on in my riding and in Mr. Tilson's riding and in members of the opposition's ridings, I lose my faith in the ability of your corporation to deliver the mail on the basis of that sacred trust. Frankly, if you can't deliver the mail to the lot line, then maybe it's time for somebody else to do it.

This is something that is very important to many Canadians, and it's a very important basic ingredient of what it means to live in a civilized society. So when I hear things like you're going to deliver the mail and restore it, I hear the proviso that it's to every safe mailbox, but maybe the problem is your definition of safe.

The other thing I'd add is about presenting statistics to the committee. My thoughts and heart go out to those employees affected, but when I hear things like 34 accidents and two fatalities, if I tell you that there were 34 accidents and two fatalities yesterday in this country involving Chevrolet Impalas, that doesn't tell me anything. I think there needs to be a little more forthrightness with this committee when it comes to stats like that and when it comes to telling the committee that you're going to restore mail delivery to every safe mailbox.

I've been hearing this for months now, and frankly I am one of these parliamentarians who are losing confidence in the ability of Canada Post to deliver what is an essential public service to hundreds of thousands of rural Canadians. In testimony in front of this committee, you said that 68% of the mailboxes assessed to date are safe. Therefore, 32% have failed. If that's the trend for the rest of the 840,000 mailboxes in this country, that means 240,000 Canadians are going to have their rural mail delivery removed. That is not something that, in my view, is acceptable.

Thank you, Mr. Chair.

5:30 p.m.

Conservative

The Chair Conservative Merv Tweed

Ms. Greene, I'll give you one minute to respond.

I'm sorry for the timing.

5:30 p.m.

Chairman of the Board of Directors, Canada Post Corporation

Gordon Feeney

We need to respond to that.

5:30 p.m.

President and Chief Executive Officer, Canada Post Corporation

Moya Greene

This, in my opinion, is a very unfair attack on the great work the company does. We deliver the mail in all kinds of weather, at all times of the year, in all kinds of geography, 14 million boxes every day in this country, and 96.3% of deliveries are on time. So worried are we about how rural Canadians, in particular, think about the service Canada Post is delivering, we have done surveys of them. We find that 88% of rural Canadians vote Canada Post service is excellent. In the province of Quebec just two weeks ago, we were named the third most respected company in the province.

So when you say that Canadians are losing confidence, that is a great worry to me, Mr. Chong. In your area, I do not know what else we can do to help you appreciate the work that has gone into the safety tool. I understand that some of our people have gone through the tool with you, have visited your riding and brought the tool there and shown how it is applied.

The other thing I would say is that even in places where service has been disrupted—which is an awful thing—90% of Canadians, once they have had the issue explained to them, come to understand it. While we are determined to make sure that lot line delivery continues, we can only do so within the safety framework of the Government of Canada. We cannot do so while putting people's lives at jeopardy to deliver mail in Canada, Mr. Chong. We cannot.

5:30 p.m.

Conservative

The Chair Conservative Merv Tweed

Thank you, Ms. Greene.

With that, I will thank you and Mr. Feeney for attending today and answering the questions of the committee. I know there's another event booked here, and we're already five minutes past our time, so thank you again.

The committee will meet again on Wednesday.

Mr. Volpe, we have another group coming in here, so please be quick.

5:35 p.m.

Liberal

Joe Volpe Liberal Eglinton—Lawrence, ON

Maybe I could ask it afterwards.

5:35 p.m.

Conservative

The Chair Conservative Merv Tweed

Okay. With that, the committee is adjourned.