Australia Post proposing to increase stamp cost to $1.10

Australia Post wants to lift the cost of posting an ordinary letter by 10 per cent.

Australia Post is proposing to increase the cost of sending a letter by 10 per cent to $1.10. Picture:Rob Leeson.

Australia Post is proposing to increase the cost of its letter service by 10 per cent, in what would be the first increase in the price of stamps since 2016.

The postal service has asked regulator the Australian Competition and Consumer Commission to assess its proposal to increase the price of ordinary letter services.

Australia Post’s plan would see the rate charged for ordinary small letters delivered to its regular timetable rise from $1.00 to $1.10 from January next year.

The price of delivering ordinary large letters at the regular timetable would also rise by 10 per cent.

Both increases are well above the current inflation rate of 1.6 per cent.

In 2016, Australia Post increased the price of a regular stamp from 70 cents to $1.

“In assessing these proposed price increases, we will consider various issues including trends in the postal industry and whether Australia Post has adequately explored efficiency improvements before increasing its letter prices,” ACCC commissioner Cristina Cifuentes said.

“We will welcome submissions on this proposal and will take into account the views of industry stakeholders, consumers and Australia Post itself.”

Australia Post’s letter business lost $190 million last year and the organisation said that the proposed increase would help keep post offices open. Increased charges would cost the average household which regularly sends letters $1.50 a year, it claimed.

The majority of concession stamps would be protected under the proposed changes, including those pensioners and veterans, and the price of 65 cent seasonal greeting card stamps would stay the same.

“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,” Australia Post chief executive Christine Holgate said.

The consumer watchdog does not approve the proposed price increase, but is required to assess the proposed price increase in accordance with the Competition and Consumer Act and then notify Australia Post on whether it objects to the proposed price increase.

The ACCC said that it intended to release its preliminary view on Australia Post’s draft proposal in November.

The proposed changes come after Australia Post announced a major overhaul to its communication network, including the upgrading of more than 4000 sites.