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Green light for Aus Post price hike

Adam Zuchetti
Adam Zuchetti
14 November 2019 1 minute readShare
Letter with postal stamps

Australia Post will push ahead with its plans to hike the cost of certain postal services in the new year, after clearing a potential roadblock.

It was revealed in August that the national postal service plans to hike its prices by 10 per cent for letters (although Christmas stamps and priority labels will remain at their current prices), but the ACCC was given the proposal to examine on competition grounds.

The ACCC has now said that it has no objections and will not stand in the way of the price increase, which will take effect from January 2020.

“We are satisfied that the proposed price increases are unlikely to result in Australia Post recovering more than its cost of providing monopoly letter services, given the forecast decline in letter volumes,” ACCC commissioner Cristina Cifuentes said on Thursday (14 November).

“Although Australia Post has exceeded the efficiency targets it set for its monopoly letter services in 2015, it has not yet attained the efficiency levels of comparable overseas postal operators, but is on a path to bridging the gap.”

She added: “The ACCC will continue to monitor Australia Post’s progress in this area in considering any future proposal for price increases.”

Australia Post welcomed the ACCC’s lack of objections, and will go ahead with increasing its Basic Postage Rate from $1.00 to $1.10.

“Australia Post will now progress the required processes associated with the proposed increases to take effect on 2 January 2020,” it said in a statement on its website.

“This will be the first increase in four years and cost the average household less than $1.50 per year.

“There will be no change to the price of concession stamps at 60 cents, available to 5.7 million Australians, including pensioners and veterans. Similarly, the 65 cent seasonal greeting card stamps will not change.

“The increase is subject to regulatory processes which Australia Post expects to be completed over the coming weeks.”

Business community divided

At the time the price rise was first made public, there were heated views from the business community, both for and against the increase.

The Post Office Agents Associated Limited (POAAL), which represents Australia Post licensees and other mail businesses, said the increase was essential.

“The letters service should be self-funding, and not dependent on cross-subsidies from other parts of Australia Post’s operations, such as parcels,” its director, Bob Chizzoniti, said.

However, the printing industry took a very different view, with The Real Media Collective’s Kellie Northwood slamming the 10 per cent cost impost as “yet another slap in the face” for her industry that would “be detrimental to Australian jobs”.

Green light for Aus Post price hike
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Adam Zuchetti
Adam Zuchetti

Adam Zuchetti is the former editor of MyBusiness and a senior freelance media professional, specialising in the fields of business, personal finance and property. In 2020, he also embarked on his own business journey – inspired in part by the entrepreneurs and founders he had met through his journalistic work – with the launch of customised pet gifting and subscription service Paws N’ All.

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