Question Period Note: Canada Post Corporation Financial Stability

Canada Post is facing existential financial challenges due to lower revenues resulting from the decline in letter mail volumes and the increasingly competitive parcels market.

• Canada Post is effectively insolvent, and repeated bailouts are not a long-term solution. This situation is unsustainable
  • Transformation is required to ensure the survival of Canada Post and protect the services Canadians rely on
  • The Government is working closely with Canada Post to transform its operations to improve its financial sustainability and the long-term viability of Canada’s postal system
  • Despite its financial challenges, Canada Post continues to deliver critical postal services, from coast to coast to coast

If pressed on the labour situation:

• The Government is pleased that an agreement in principle has been reached between Canada Post and the Canadian Union of Postal Workers and looks forward to its ratification by postal workers

If pressed on the need for an additional bailout:

• The Government will ensure Canada Post has the necessary liquidity to continue operating and delivering services to Canadians while it transforms

If pressed on the Canada Post’s transformation plan:

• The reforms the Government of Canada announced include amending letter service standards, ending the moratorium on community mailbox conversions, and lifting the 1994 Rural Moratorium
• Given Canada Post’s deteriorating financial situation, the implementation of these reforms is a first step towards transforming and rightsizing the Corporation’s operations and structure
• The Government is currently thoroughly reviewing the plan submitted by Canada Post on November 7, 2025, which outlines its implement plan for the announced reforms and presents further proposals that would place the Corporation on the path to financial sustainability reforms.

Canada Post’s legislated mandate requires it to be financially self-sustaining but it has reported over $5.5 billion in operating losses since 2018, including more than $1 billion in the first three quarters of 2025 alone. These pressures have been compounded by the uncertainly caused by the 2-year long labour negotiations and various strike actions by the Canadian Union of Postal Workers in 2024 and 2025.

Canada Post’s financial results reflect the impacts of the decline of letter volumes, the increasingly competitive parcel market, and growth in addresses and delivery costs. Over the last 20 years, the amount of mail Canadians receive has declined by 70%, while the number of addresses has increased by more than three million. This has resulted in lower revenues and higher costs for Canada Post.

In December 2024, William Kaplan was appointed to lead an Industrial Inquiry Commission (IIC) to examine Canada Post’s financial challenges in the context of the collective-bargaining dispute, with special attention to the underlying causes of the dispute. The IIC report, submitted on May 15, 2025, outlined structural and financial challenges faced by Canada Post and made recommendations.

On September 25, 2025, the Government announced it was accepting the IIC recommendations and instructed Canada Post to develop a comprehensive transformation plan within 45 days, given that additional measures would be necessary to return the Corporation to financial solvency.

On November 7, 2025, Canada Post submitted its comprehensive transformation plan. The plan lays out an implementation strategy for conversions to community mailboxes, modernizing its network of post offices, amending service standards for letter mail and reducing its management and overhead costs.

On November 21, 2025, an agreement in principle was reached between Canada Post and the Canadian Union of Postal Workers. The parties must still agree on contractual language that will form collective agreements and will be put to a vote by members. While strike action is now paused, it is highly uncertain how quickly mail volumes will recover as many customers have made alternative shipping arrangements for the peak holiday period. Moreover, should tentative agreements not be reached because the parties disagree on contractual language, or if the members vote against the agreement, the labour uncertainty could resume.

• In November 2025, Canada Post reported a $541 million loss before tax in the third quarter, marking its largest quarterly loss in history. Canada Post also reported that the $1.034 billion in repayable funding provided in 2025 would run out earlier than expected and that it will require additional funds in early 2026
  • On November 21, 2025, after more than two years of negotiations, Canada Post and the Canadian Union of Postal workers reached agreements in principle, and strike action is now paused while contractual language is finalized and the new agreements are ratified by union members