Australia Post “continues to face structural challenges in its Letters business that are expected to only get worse”
Australia Post has lodged a draft notification with the Australian Competition and Consumer Commission (ACCC), proposing an increase in the Basic Postage Rate (BPR) from $1.50 to $1.70 from 1 July 2025 to offset significant ongoing losses in its Letters business.
Concession and seasonal greeting stamps will not change price, remaining at 60 cents and 65 cents respectively. The prices of these stamps have not changed since they were launched more than 10 years ago.
Currently, fewer than three per cent of letters are sent by individuals, with the vast majority mailed by businesses and government agencies. Total letter volumes are expected to reduce further as digitisation increases.
The average household purchases five to six full-rate stamps each year and the proposed increase would equate to an annual average increase of $1.20 per household. Even with this increase, Australians will still have one of the lowest stamp prices in the OECD and Australia Post will continue to lose money delivering letters.
Australia Post’s Letters business remains in structural decline, with volumes dropping a further 12.9% in FY24, resulting in a $361.8m loss. Letter mail is now at a level not seen since the 1950s.
Group Chief Executive Officer and Managing Director Paul Graham said the rapid ongoing decline in the usage of letters by Australian households had made a BPR price increase necessary.
“Australia Post continues to face structural challenges in its Letters business that are expected to only get worse. This proposed increase will primarily impact business and government customers and is necessary to offset growing losses in our Letters business as more people choose to communicate digitally.
“We remain focused on continuing to deliver for all Australians, especially for communities in rural and regional Australia, but this is only possible if Australia Post is financially sustainable,” Mr Graham said.
Responding to the notification, POAAL Director Bob Chizzoniti OAM said: “While stamp sales have been in gradual decline at post offices over recent years, letters are still the core of the postal business,”
“We will scrutinise Australia Post’s draft price notification and give our feedback to the ACCC.
“POAAL members, who own and operate Licensed Post Offices and who hold Mail Contracts, want to operate profitable businesses as part of the Australia Post network.
The ongoing financial success of Australia Post overall is important to our members.”
To provide further transparency and to inform future planning for customers, Australia Post has also indicated a possible pricing path for FY27 and FY28 postage rates to offset forecast losses in its Letters business. This price path shows indicative increases to the BPR of 15 cents in FY27 and the same amount in FY28 and both are subject to change and consultation.
