26 Apr 2012

NZ Post looks at cutting mail delivery days

2:09 pm on 26 April 2012

New Zealand Post is considering reducing the number of mail delivery days from six to three a week because of what it calls a serious and irreversible decline in its business.

The state-owned enterprises chairman has warned the business must make fundamental changes this year in order to sustain its services.

In a letter to the State-Owned Enterprises Minister, New Zealand Post chairman Michael Cullen said the biggest issue facing the organisation is the significant and ongoing decline in mail volumes.

He says the business has reached a point where it has exhausted most of its short-term fixes. New Zealand Post can no longer cut costs and rely on new products to match the falling volumes.

Some options outlined in the letter include changing the number of days mail is delivered and working more closely with its courier network.

New Zealand Post Group chief executive Brian Roche says he is seeking a change to the company's agreement with the Crown which would let it reduce delivery days and postal outlets. He says that would led to fewer jobs.

Mr Roche there has been an irreversible decline in the mail business. "We've had the largest decline in the last six months that we've experienced for ten years, so we've got a serious challenge and it is not going to go away."

Brian Roche says it is inevitable that the six day a week delivery will have to be cut over the next two to three years, potentially to a three days a week, though no final decisions have been made.