Australia Post to increase stamp price by 10 per cent

Aussies will soon need two coins instead of a $1 coin to buy a humble stamp, with another price hike on the way to combat Australia Post’s falling snail mail profits.

Australia Post want to raise the price of stamps from $1 to $1.10. Picture: Jesper Nielsen

Australia Post will today urge the competition cop to let it hike stamp prices 10 per cent to $1.10.

It means Aussies would need two coins from the spare change to cover the cost of a basic domestic stamp.

Post chief Christine Holgate told the Herald Sun the move — a 10 cent hike in line with inflation — was needed as the service was bleeding cash as consumers sent less snail mail, instead turning to email and online.

The price of a standard stamp was last increased in January 2016 — hiked from 70c to $1.

But now Ms Holgate said 820 million fewer letter were being sent now compared to when the last hike took place.

If the price rise is approved, the change will kick-off in January next year.

About 5.7 million pensioners and the poor will be shielded with concession stamp prices frozen at 60 cents, she said.

Christmas “season’s greetings” stamps will be 65 cents for everyone.

The Australian Competition and Consumer Commission by law has to consider the price increase. It then requires government approval.

Ms Holgate said the proposed increase was being balanced with “efficiency savings” to help keep post offices open and posties on the beat.

She said Post will “do everything we can to protect the Post Office service and Posties”.

Holgate said the proposed increase would cost the average letter sending household less than $1.50 per year.

“It will help keep Post Offices open — including Australia Post’s vital regional and rural network — keep posties delivering five days a week and ensure Australians everywhere can continue to access these important services,” Ms Holgate said.

The MCG on a stamp. Source: Australia Post

She said that despite letter volumes plummeting the service had to deliver to more houses as the population boomed.

“In the last financial year, we delivered a profit in-line with that three years earlier. We did this with 820 million less letters delivered to over 700,000 more homes,” Ms Holgate said.

“Our posties deliver to more than 12.1 million addresses across the country. It doesn’t matter if they have one letter or 100 for the address, they still need to drive past the letterbox each day.”

She said the letter business last year lost $190 million despite huge efforts to make the service more efficient.

“It is important that we responsibly address pricing if we are to protect this important service and keep our network of community post offices open.”

Ms Holgate said the ACCC in its assessment of whether to allow the hike would hold the postal service to a higher efficiency standard than most Aussie businesses faced.

She said the battle for more efficiency did not mean job cuts.

“We are now getting posties to carry parcels, they are carrying 45 per cent of parcels for Post now.”

She said the move would not harm Post’s reputation in the community. “People trust us more because we are being so open,” she said.

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The Post chief said despite the push for a rise Australia still had the third lowest stamp prices in the world — cheaper than in the United Kingdom and New Zealand.

Despite the fall Ms Holgate said it was too early to pronounce “snail mail” as dead.

“In all honesty we still carry over 2 billion letters a year, this is a massive business it is just in massive structural change.”

Under any changes charities will also receive significant discounts off the basic postage rate, Post said.

Since the last stamp price hike in January 2016, Post said the General Retail Industry Award has risen by 13 per cent.

In February, Ms Holgate revealed the looming move to hike prices in an interview with the Herald Sun.