Postage rates set to rise

The basic postage rate is set to rise from 50 cents to 55 cents as the Australian Competition and Consumer Commission (ACCC) has upheld Australia Post’s proposal.

The ACCC has issued its final decision to concede Australia Post’s proposal to lift letter prices, including large ordinary letters, and small and large PreSort Bulk Mail.

“The ACCC has decided not to object to Australia Post’s proposal because the proposed price increases do not involve Australia Post over-recovering the costs of providing these letter services,” ACCC chairman Graeme Samuel said.

“The ACCC did not identify a concern that Australia Post’s current proposal did not provide sufficient certainty for some customers. Therefore, in its decision, the ACCC has established a framework for future price notifications that will encourage Australia Post to continue to reduce costs, improve productivity, and provide more certainty for Australia Post’s customers.”

Following the decision, Australia Post needs to give written notice of the postage rate increase to the communications minister, who has the power to disapprove proposals to vary the rate within 30 days after receiving the notice.

This February, Australia Post lodged a draft notification, seeking to lift the letter rates amid the growing operational costs.

The company’s group manager letter Allan Robinson has previously said due to rising fuel, wages and other transportation costs, domestic reserved letters profitability dropped by 18 per cent last year, with a loss around $12 million expected this year.

“The number of delivery addresses for home and businesses has increased by over 800,000 since the last price rise in 2003,’ Mr Robinson said.

“The task has got bigger, the costs have increased, but growth in the letters area has only been modest.

“Even with the proposed 55 cent stamp rates…it is, and still will be, the third lowest basic postage rate in the OECD.”

Australia Post proposes to increase postal prices with effect from 15 September 2008. 

Send this to a friend