MINISTERIAL STATEMENT – Government of Canada instructs Canada Post to begin transformation

GATINEAU, QC, Sept. 25, 2025 /CNW/ – Today, the Honourable Joël Lightbound, Minister of Government Transformation, Public Works and Procurement, issued the following statement:

“Canada Post is a national institution, older than our country itself, that has been serving Canadians for more than 150 years. For generations, postal workers have connected communities in every corner of the country, providing an essential lifeline to hundreds of northern, Indigenous, and rural communities. Canadians continue to rely on it today, and it remains a vital public service.

At the same time, Canada Post is now facing an existential crisis. Since 2018, the corporation has accumulated more than $5 billion in losses. In 2024 alone, it lost over $1 billion, and in 2025, it is already on track to lose close to $1.5 billion. Earlier this year, the federal government provided a $1-billion injection to keep the corporation operational. In the second quarter of 2025, Canada Post posted its worst quarterly results ever, losing $407 million. Today, the corporation is losing approximately $10 million every day.

Twenty years ago, Canada Post delivered 5.5 billion letters annually. Today, it delivers only 2 billion, even as the number of households has grown. That means fewer letters are being delivered to more addresses, while fixed costs remain high. At the same time, parcels volumes — which should have been Canada Post’s growth opportunity — have declined. In 2019, Canada Post delivered 62% of parcels in Canada; today, its market share has dropped below 24%, with private competitors taking the lead. Structural challenges, combined with outdated restrictions and stalled negotiations between labour and management, have further limited the corporation’s ability to adapt.

This situation is unsustainable. Canada Post is effectively insolvent, and repeated bailouts are not a long-term solution. Transformation is required to ensure the survival of Canada Post and protect the services Canadians rely on.

In its report released on May 15, the Industrial Inquiry Commission, led by William Kaplan, identified the scale of the challenge and recommended a path forward. Building on these recommendations, I am announcing today a series of measures to stabilize the corporation’s finances and enable its modernization.

• Letter Mail Delivery Standards: Canada Post will introduce flexibilities to reflect today’s lower volumes. The average household receives just two letters per week, yet operations remain designed for far higher volumes. By adjusting standards so that non-urgent mail can move by ground instead of air, the corporation will save more than $20 million per year.
• Community Mailbox Conversions: The government is lifting the moratorium on community mailbox conversions. Currently, three-quarters of Canadians already receive mail through community, apartment, or rural mailboxes, while one-quarter still receive door-to-door delivery. Canada Post will be authorized to convert the remaining 4 million addresses to community mailboxes, generating close to $400 million in annual savings.
• Postal Network Modernization: The moratorium on rural post offices, in place since 1994, will also be lifted. The rural moratorium was imposed in 1994 and covers close to 4000 locations. It has not evolved in 30 years, but Canada has changed.  This means that areas that used to be rural may now be suburban or even urban, but are still required to operate as rural post offices. Canada Post must return to the government with a plan to modernize and right-size its network.

The government is also reviewing the process for increases to the stamp rate to modernize and shorten it, in line with Commissioner Kaplan’s recommendations.

The Government of Canada is removing long-standing barriers to reform, but leadership and structural change from within the corporation will be essential. Canada Post must take decisive action to deliver the services Canadians need in a way that is financially sustainable. As our government reviews its balance sheets so we can spend less and invest more, we are asking Canada Post to do the same.

Canada Post is a vital national institution worth preserving. The measures announced today will help place the corporation on a stronger financial footing and provide the flexibility it needs to adapt to a rapidly changing environment.

Transforming an institution of this size will take time, but it is necessary to protect postal services for the future. Canadians deserve a service that is reliable, affordable, and sustainable — and today’s announcement is the first step toward securing that future.”

Follow us on X (Twitter)

Follow us on Facebook

SOURCE Public Services and Procurement Canada