Canada Post says it plans to raise the price of stamps by 25 per cent next January, as the mail carrier seeks to recover from a financial tailspin.
If approved by federal regulators, the cost of stamps purchased in a booklet, coil or pane will increase from 99 cents to $1.24 per stamp. Those stamps account for the vast majority of sales, the company says.
Individual stamps would go up in price from $1.15 to $1.44 for a domestic letter.
Other products, including U.S., international letter-post and domestic registered mail, would also be affected by the rate changes.
Pending approval, the changes would take effect on Jan. 13, 2025, “after the busy holiday mailing season,” Canada Post said Friday.
The price hike is far steeper than the seven-cent increase that took effect in May.
However, Canada Post estimates it will ultimately cost Canadian households an extra $2.26 per year.
The company said the proposed increase accounts for declining letter deliveries, which used to be Canada Post’s main source of revenue but has dropped 60 per cent over the past two decades.
“Ensuring stamp prices better reflect the cost of providing the service is an important step forward and aligns with efforts being taken by postal services around the world,” president and CEO Doug Ettinger said in a statement.
“The reality is, however, that more needs to be done to address the significant long-term structural and financial issues facing the corporation. We are taking action to manage our costs while working closely with the government on a path to ensure the postal service is there for Canadians today and tomorrow.”
Canada Post executives warned late last month that the Crown corporation’s financial situation is “unsustainable” as it struggles to compete against e-commerce platforms and delivery companies and faces dropping demand.
The executives, including Ettinger, told the company’s annual general meeting they are at a “critical juncture” and that “significant change is urgently needed to preserve Canada Post’s delivery network.”
The company posted its second-biggest loss on record last year at $748 million before tax, and has lost $3 billion before tax over the past five years.
It also notes the federal government has not approved a corporate plan for Canada Post since 2020, and has yet to sign off on a submitted plan that would take the organization into 2028.
But concerns about what a reimagined Canada Post could look like tend to centre around either the hundreds of millions it would cost taxpayers to cover its fiscal gaps in the form of more government funding, or the service cuts that could be needed to cut budget strain — and how to ensure all Canadians can keep receiving mail.
The government has been vague about what specific actions it’s willing to take to ensure Canada Post’s survival, only promising it will do so.
“The Government of Canada is actively working with Canada Post to secure the long-term viability of this essential service,” Public Services Minister Jean-Yves Duclos was quoted as saying in Canada Post’s statement.
“We will ensure postal service is maintained as part of Canada Post’s mandate as a ‘service first’ organization focused on delivering the mail.”
Ideas for generating more revenue floated by the Canadian Union of Postal Workers and the federal New Democrats include expanding services at post offices to include postal banking and passport renewals, and developing its own e-commerce platform for small and medium-sized businesses that could compete with Amazon.
Those measures and others would require government support, however.