Australia Post to review licensed post office payments

Australia Post to review licensed post office payments

Australia Post is set to launch an independent review of its licensed post office network in the light of the ongoing decline in letter volumes and customer numbers. The national postal service said it was in the process of establishing the terms of reference for the study, which will look into the sustainability of the network.

The review comes in the wake of a Senate inquiry which last September called on Australia Post to rethink its payments for licensed post offices with operators struggling on “subsistence levels of remuneration”.

In the mean time, Australia Post said it will bring forward its planned $41m in additional payments for licensed post office operators by three months, and set up a working group chaired by Senator Helen Kroger to help address strategic challenges faced by the network.

The company said the working group includes members of organisations representing the operators of Australia’s 2,900 licensed post offices, including the LPO Group, APLAC and POAAL.


Ahmed Fahour, the Australia Post managing director and group chief executive, said his company was “committed” to maintaining the extensive network of licensed post offices.

“In more recent times, with overall customer numbers and letter volumes declining, the business environment for both licensees and Australia Post has become more challenging and we are looking at a number of ways to address this,” he said.

“We are currently establishing an agreed terms of reference for a formal independent study into our licensed post office network, to be conducted by a third-party. The findings of this study will form part of a broader review into the structure and value of payments to licensees.”

The review of LPO arrangements comes as part of a wider reform at Australia Post as it contends with the impacts of declining letter volumes.

The firm has already made some changes, including revisions to its dispute resolution process and the process for transferring customers from licensed post offices to other Australia Post services. The Senate inquiry had said Australia Post’s “poaching” of customers from licensed post offices was “unacceptable”.

The company is also currently working on how to convert franchised post offices into licensed post offices.

Elsewhere, in an attempt to reinvigorate its letter services, Australia Post is in the process of seeking government approval to split its letters service into a two-tier offering, providing two different delivery speeds for retail customers, similar to the services already available for business customers.

The new offering would provide a priority service delivering mail to the current standards, while also launching a new lower-cost “regular” service delivering mail with one or two-day additional transit times.

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