US Post office mulling end of Saturday deliveries
Faced with a weaker demand for postal services and rising costs, the Postal Service Board of Governors directed management Tuesday to study how much the agency could save by eliminating Saturday mail service and consolidating postal facilities.
The plan comes after last week’s announcement that the Postal Service will cut spending by $2.5 billion by 2003. The agency will also cut 75,000 work years, squeeze administrative costs by 25% and reduce transportation costs by 10% over the next five years.
The Board asked management to immediately freeze capital construction commitments that affected more than 800 facility projects.
The board reaffirmed its commitment to universal service and reiterated its call for statutory reform of the laws governing the Postal Service. Without the flexibility of a new regulatory model, it said, it must consider cost-cutting in order to maintain universal service.
The Postal Service said it is facing a loss of $2-3 billion this fiscal year. Contributing factors include very little control over some labor costs, with arbitrated wage rate increases that can exceed the rate of inflation, escalating fuel costs, changes in the type of mail being processed, an increasingly competitive communications marketplace, and forecasts calling for the diversion of some first-class mail to electronic alternatives
