Australia Post boss questions whether letters should continue to be delivered daily

The boss of Australia Post has questioned whether posties should continue to deliver mail daily, warning its letters business is on life support.

Australia Post chief executive Paul Graham. Picture: NCA NewsWire / David Crosling

Households can expect fewer mail deliveries and higher stamp prices as Australia Post deals with massive losses from its letters business.

AP chief executive Paul ­Graham said major change was needed to modernise the $9bn postal service amid effects of the internet boom and smartphone use.

“Since 2007-08, mail volumes have fallen by 66 per cent – and per-household mail volumes are expected to halve in the next five years,” he told an American Chamber of Commerce event.

“The average household today receives less than two letters per week and sends less than 3 per cent of all mail.”

Since 2007-08, mail volumes have fallen by 66 per cent. Picture: NCA NewsWire / Kelly Barnes

Mr Graham said that legislation from 1989 requiring mail to be delivered five days a week and 98.5 per cent on time to every Australian household had to change.

“The anecdotal information and feedback we get (is) people are more concerned about the delivery of a parcel today than the delivery of a letter,” he said. “We are always going to be here to deliver services to you, but the way in which we deliver those services may change.”

Mr Graham said setting stamp prices was a “draconian old world process” that needed to be overhauled, with AP’s letter business losing $189m in the first half of 2022-23.

Asked what the public could expect, Mr Graham said the “price of a stamp will certainly track the growth of our cost base and today it is significantly less than the cost to serve”.

With public consultation on the federal government’s postal services modernisation discussion paper now closed, Mr Graham called on MPs and the public to appreciate that the postal service was at a crossroads.

“We will work with government, and a lot of it will be based on the community feedback that we get, what does the community actually expect from Australia Post, what services do you want to use both today and in the future,” he said.

“It’s a stark message, but the Australian community must understand that without change to their national postal service, its long-term viability is at risk.”

Mr Graham said that current community service obligations such as the distance a post office had to be to from a citizen must be reviewed.

“What we need is the commitment and goodwill from the parliament to make the changes necessary to deliver a sustainable future,” he said.