Canada Post to phase out urban home mail delivery

Canada Post is phasing out door-to-door delivery of regular mail to urban residents and increasing the cost of stamps in a major move to try to reduce significant, regular losses.

The Crown corporation announced its plans in a news release Wednesday, saying urban home delivery will be phased out over the next five years.

Starting March 31, the cost of a stamp will increase to 85 cents each if bought in a pack, up from 63 cents. Individual stamps will cost a dollar.

Canada Post said that over the next five years, it will eliminate 6,000 to 8,000 positions, but it expects 15,000 workers will leave the company or retire within that period.

"With the increasing use of digital communication and the historic decline of letter mail volumes, Canada Post has begun to post significant financial losses," the corporation said in the release.

"If left unchecked, continued losses would soon jeopardize its financial self-sufficiency and become a significant burden on taxpayers and customers."

The first communities that will switch to community mailboxes (CMBs) will be announced in the second half of 2014, according to the release.

Transport Minister Lisa Raitt said in September the idea of cutting door-to-door delivery in urban areas was worth considering in the face of $104 million in losses in the second quarter.

​​Revenue dropped $20 million in the first three quarters of 2013 compared to the same timeframe last year.

Here are some other numbers, from Canada Post:

5,094,694 people get door-to-door delivery in Canada.

Average cost per address is $269.

3,804, 574 get mail through group mail boxes.

Average cost per box is $117.

A Conference Board of Canada report released in April said two-thirds of Canadians already do without door-to-door regular mail service, whether through rural mailboxes, group mailboxes, delivery facilities or "centralized mail points."

It said stopping door-to-door delivery of mail to urban Canadians and replacing it with CMBs would have the largest financial impact on a projected $1-billion Canada Post deficit by 2020.

Canada Post said this plan will help return it to "financial stability" by 2019.

It said the numbers do not include savings through pension changes or labour costs, since those two aspects will be worked out through collective bargaining.

CMBs have been around since the 1980s, with the rise of new home developments, where they are now standard. 

Wednesday's announcement was made two weeks before Christmas, during one of the busiest delivery periods of the year.

The Canadian Union of Postal Workers (CUPW) has scheduled a news conference for 1 p.m. ET Wednesday.

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