Australia Post ahead of budget despite pleas for changes

Australia Post has been making more money than it budgeted for in March and April, despite pleas for regulatory changes.

Australia Post is weathering the economic conditions better than expected. Picture: AAP

Australia Post has been making more money than it budgeted for in March and April, despite chief executive Christine Holgate pleading with crossbench senators to support regulatory changes to allow the postal service to deliver every other day in cities and extend delivery times on some routes.

In response to a series of questions from Labor senator Kimberley Kitching, Australia Post confirmed that its overall revenue had tracked higher than budget in March and April, due to an online shopping bonanza.

It comes as an inquiry is set to begin into the regulatory changes that the Morrison government granted Australia Post to help it combat the COVID-19 pandemic.

In response to Senator Kitching’s questions, Liberal senator Anne Ruston said: “Total revenue was higher than budget in March and April 2020.

“Revenue performed positively against budget in March and April 2020, driven by increased parcels, (which) partially offset decreases elsewhere including letters, international services financial services, passport services and identity services.”

Labor and the Greens are seeking to overturn the changes, which will be reviewed in June next year, saying they received little consultation. Meanwhile the unions say the temporary reforms will put 2000 posties out of work. But Australia Post has dismissed that claim, saying there will be no forced redundancies.

The Australia Post budget revelations are expected to place more pressure on crossbenchers, who have faced intense lobbying from the government and Ms Holgate to support the changes, and urging from ­opposition and unions to oppose them.

Australia Post also confirmed its reserved letters business delivered more revenue than budgeted in March, despite Ms Holgate asking the government for regulatory relief citing a halving of letter volumes.

But in April, Senator Ruston said reserved letter services were lower than budget. Australia Post confirmed this month that letter volumes fell 28 per cent in April, and the decline accelerated to 36 per cent in May compared to the same month last year. But May 2019 was an abnormal month, given it included a spike in letter volumes from the federal election, which delivers Australia Post millions of dollars from postal voting and political campaign mail.

However, a spokesman for Communications Minister Paul Fletcher said: “Even when excluding the FY19 federal election, May 2020 letter volumes were down 28 per cent year on year — a dramatic acceleration of the average 10 per cent per annum decline in letters volume for 2014-19.

“This is up from an average of 5 per cent per annum volume decline in 2008-13.”

Senator Kitching also asked what dividend Australia Post had forecast to pay the commonwealth prior to the COVID-19 outbreak.

Senator Ruston said the postal service had proposed a $24m dividend, including $21m for the 2019 financial year that was paid in ­October.

The remaining $3m was an interim dividend for the 2020 financial year and has been “suspended to allow for cash retention in the context of the COVID-19 pandemic”, Senator Ruston said.