The ACCC today released an issues paper to identify issues arising from Australia Post’s draft proposal to the commission last month seeking to increase the prices of its ordinary letter service.
“Based on Australia Post’s proposal a $1 basic postage rate will significantly reduce the losses on Australia Post’s stamped letters by 2016-17.
“Further, Australia Post’s monopoly letter services (stamped and bulk business mail) are forecast to reverse their previous loss making state by 2016-17,” ACCC Chairman Rod Sims said.
As iTWire reported last month, Australia Post’s proposal to increase prices comes in the face of a continuing rapid decline in ordinary mail volumes, losses in its mail delivery business and planned voluntary staff redundancies.
If given the green light by the ACCC, the proposed increases to the cost of sending ordinary letters, excluding priority paid, would see prices rise by 30 cents from to $1.
The ACCC said today it’s assessment of Australia Post’s pricing proposal will focus on:
• The method by which Australia Post allocates costs between its services
• Australia Post’s forecasts of letter demand and revenues
• The forecast improved financial performance of its monopoly letter business, and
• Productivity improvements leading to operational cost savings expected from implementing a slower letter delivery timetable.
Submissions to the ACCC must be lodged by 15 October and the commission will publish its response to Australia Post’s draft proposal in November.
The issues paper and details of how to make a submission are available here.