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APWU Denounces USPS Rate Proposal
Planned Rate Hike Would Continue ‘Failed
Strategies’
APWU Web News Article #015-09, Feb. 12, 2009
APWU President William Burrus has denounced the postage increase proposed by the USPS Feb. 10, declaring, “The planned rate structure would continue the failed strategies that have brought the Postal Service to the brink of disaster.”
The “worksharing” discounts for first-class letters would actually increase in four of five categories, Burrus noted; in the fifth category the discount would remain the same. The USPS proposal calls for an increase of 4.76 percent for single-piece first-class letters (from 42 cents to 44 cents), but only a 3.26 percent increase for first-class automated letters.
“Once again the Postal Service is asking individual customers and small businesses to subsidize major mailers and mail pre-sorters,” Burrus said.
“But the real travesty is that the rate proposal jeopardizes the survival of the Postal Service. The USPS simply cannot afford to grant these excessive discounts.” In a preliminary report on Feb. 4, USPS data showed that it ended the first quarter of Fiscal Year 2009 with a net loss of $384 million and a mail-volume decline of 5.2 billion pieces compared to the same period last year. “With no economic recovery expected for the remainder of FY 2009, the Postal Service projects volume for the year will be down by 12-15 billion pieces,” the report concluded.
Despite these dire predictions, the USPS rate proposal offers expanded discounts. An analysis by Economic Consulting Services shows that because of the modest increases in postage for pre-sorted mail, discounts would increase.
Table 1, below, shows that postage for automation-mixed AADC first-class letters (letters that have been pre-sorted to an Automated Area Distribution Center) would increase from 36.9 cents to just 38.2 cents; Table 2 shows that the discount from the postage for single-piece letters would increase from 5.1 cents to 5.8 cents.
Table
1: First Class Letter Rates - |
||||
First Class Letters |
Rates Effective May 2007 |
Current
Rates
|
Proposed Rates |
|
Single Piece |
41 |
42 |
44 |
|
Presort Nonauto |
37.3 |
39.4 |
41.4 |
|
Auto-Mixed AADC |
36.0 |
36.9 |
38.2 |
|
Auto AADC |
34.1 |
35.1 |
36.0 |
|
Auto 3-Digit |
33.4 |
34.6 |
35.7 |
|
Auto 5-Digit |
31.2 |
32.4 |
33.5 |
|
Table
2: First Class Letter Discounts from Every Single Piece Rate
-
|
||||
First Class Letters |
Discounts
Effective |
Discounts Effective |
Proposed Discounts Effective May 2009 |
|
Single Piece |
NA |
NA |
NA |
|
Presort Nonauto |
3.7 |
2.6 |
2.6 |
|
Auto-Mixed AADC |
5.0 |
5.1 |
5.8 |
|
Auto AADC |
6.9 |
6.9 |
8.0 |
|
Auto 3-Digit |
7.6 |
7.4 |
8.3 |
|
Auto 5-Digit |
9.8 |
9.6 |
10.5 |
|
The increase in the gap between the cost of single-piece first-class
letters and pre-sorted mail reverses last year’s rate policy, when
rate discounts remained flat or were reduced slightly from the 2007 levels.
“The USPS response to its financial crisis has been to cut work hours and consolidate postal facilities,” Burrus said, “and service has suffered. But management has refused to take any steps to reduce the loss of revenue from ‘worksharing’ discounts or from subcontracting.”
“As a result, postal managers have no reason to expect understanding from employees — who have been asked to sacrifice time and again because of the financial crisis.
In testimony [PDF] before a congressional subcommittee last month, Postmaster General John E. Potter said he would ask union leaders “to begin talks now to create needed levels of workforce flexibility,” Burrus observed.
“Our response is direct,” the union president said. “The Postal Service’s one-sided, misguided strategies cannot succeed. Therefore, we have no interest in further discussions regarding mutual efforts to respond to the USPS economic challenges. The loyalty of postal management does not lie with postal employees, but with the large mailers and mail consolidators.”
