Canada Post in Parliamentary Rummage Sale

Another Moral Economy Column
By Christopher Lind
10 June 2010

Rural Canadians are resilient, multi-talented people. However, they also depend on a few key institutions to support their diverse way of life. One of those institutions is the Post Office. Fortunately Canada Post recognizes their unique role. This is how the Crown Corporation describes its self-understanding on its website:

“For longer than Canada has been a country, Canada Post has been part of the bedrock of rural Canada. Today we remain the only company that serves all Canadians, in their communities, and this is not going to change.”

The last year was a difficult one for Canada Post. Its volume of mail dropped 8% in 2009 and this decline wiped out 5 years of steady growth. Even though net income increased, the Crown Corporation was unable to issue a dividend to the Government of Canada because of the challenging financial conditions.

Canada Post has a mandate to provide postal service to all Canadians. The reason it can carry out this mandate without a massive subsidy is because it can use the profit from more profitable routes to subsidize the less profitable ones. As you might imagine, the Canadian Government faces constant pressure to allow competition on those more profitable routes. It is only the pressure and vigilance from 843,000 rural Canadian households, the ones who most stand to lose from the decline of Canada Post, that keeps the cross subsidy intact.

This makes the initiative of the current federal government all the more puzzling. It has introduced an omnibus bill, C 9, to remove an exclusive privilege from Canada Post to deliver mail to addresses outside Canada. Now Bill C 9 does other things too. In fact, this single Parliamentary Bill amends over 80 separate pieces of legislation. It changes the rules for Credit Unions, it changes the rules for pensions, it even changes the agreement on social security between Canada and Poland. Possible the shortest amendment in the whole Act is the one paragraph that removes international mail delivery from the hands of Canada Post.

Why would the Government want to do this? Maybe because they have tried it twice before and failed – once before the election in 2008 and again when Parliament was prorogued in 2009. This time they have buried it so deep in other unrelated amendments it looks like they are hiding it. Omnibus bills are best used for fine tuning and technical adjustments of legislation. They are poor choices for substantive changes in policy.

What is at stake here is the question of solidarity of urban Canadians with rural Canadians. It is also a matter of fairness and whether rural Canadians can get access to the same level of service from the government as other citizens. It is also a matter of economic development. If Canada Post has to cut back on rural accessibility in order to cut costs, it will make it more difficult for new businesses to start up in, or relocate to rural areas.

This amendment, buried in bin 15 of the rummage sale known as Bill C9, may seem small but its implications are huge. If you care about your rural postal service, call your MP and ask that this fundamental policy change be given its own bill and its own dedicated debate.


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This column is published in the Western Producer, Canada's largest farm newspaper. For other moral economy blogs see christopherlind.blogspot.com