A proposal to cut deliveries and physical outlets has some worried about those who will be left behind, writes Stewart Sowman-Lund in today’s extract from The Bulletin.
To receive The Bulletin in full each weekday, sign up here.
The dying days of the post
When was the last time you got a letter? Scratch that, when was the last time you got a letter you actually wanted? The days of the postal service have been numbered for some time, and now NZ Post is considering taking a sizeable knife to the network in the not-to-distant future. As reported by RNZ’s Susan Edmonds, the proposal by the Ministry of Business, Innovation and Employment (MBIE) would see the “deed of understanding” with NZ Post adjusted for the first time in 11 years. It could mean NZ Post will only be required to deliver to urban areas a minimum of twice a week and rural areas three times a week, though NZ Post would still be able to make operational decisions.
Speaking to Newstalk ZB’s Heather du Plessis-Allan, MBIE’s James Hartley said that in urban areas, the average post box gets about two letters a week and overall use had declined dramatically in recent years. “Only about 1% of letters are sent by individuals [as opposed to businesses or government services],” said Hartley. “In 2002, one billion letters went through the postal system. It’s now down to about 180 million.”
Consultation is open until December 10.
Who could be left behind?
Hartley, in his interview on Newstalk ZB, acknowledged there would be concern and said that “anecdotally” some communities, especially in rural areas and among the elderly, still rely on the mail service. Under the proposal, the number of “points of presence” for NZ Post would drop from 880 down to 500, with a possible further step down to 400 over time.
Marie Fitzpatrick of the Rural Women New Zealand group told Farmers Weekly that the proposal would impact isolated communities and NZ Post was making an assumption people would be able to drive to find services. “The proposal is silent on any detail, it does not give any indication on where those cuts will happen,” she said. The group would be preparing a submission to counter the move, adding that it wants an assurance NZ Post will adhere to the social responsibility principles as a state-owned enterprise.
In an excellent feature for The Spinoff published earlier this year, Rachel Judkins reported on the varied ways in which rural livers rely on the postal service. It’s not just for letters, said farmer Mairi Whittle, but for papers, parcels and pantry items. “Mondays and Thursdays I get bread and milk in the mail,” she explained. “It’s just so handy. You can kind of get by if you’ve got bread and milk.”
Money, money, money
As noted above, NZ Post is a state-owned enterprise. That means that, while owned by the government, it is not funded by the government and ultimately acts to turn a profit. In September, reported Jem Traylen at BusinessDesk (paywalled), NZ Post made a loss of $14m for the 2024 financial year which the company described as “fully” in line with expectations and was an improvement of $42m on the previous year. It was confident it could return to profitability in the next 12 months. “The year also saw an increase of $126m in our enterprise valuation,” said NZ Post at the time. “We were pleased to return a $100m dividend to the government as shareholder in May 2024, and expect to pay further dividends to the shareholder as the company returns to consistent profitability.”
With the decline in mail volume, the company is aiming to turn the business around through investment in new processing facilities and the acquisition of competing brands. But, with less mail, there has also had to be price increases and redundancies to keep the lights on.
Keeping with the times
As MBIE’s James Hartley mentioned, very few letters these days actually come from individuals senders. Maybe I’m in the minority, but I only ever get a “letter” when it’s my birthday (and often it comes several days late, anyway). Liam van Eeden, writing for Re:News in March, looked at this exact issue in a piece quite simply titled: “why tf do important documents only get sent through the post?”. He went on to ask why some of the mail we do still receive can’t just be sent via email. Auckland University IT lecturer Farkhondeh Hassandoust told Re:News that while having an email alternative is helpful, for some people, the postal service remained crucial. “It’s very important to keep in mind that older people may not have access to proper digital tools, and prefer postal mail.”
The same issue has been raised in recent years around banking, with many smaller communities losing access to physical outlets in favour of online services. Age Concern told RNZ in February that while the closure of bank outlets was inevitable, people needed to time to understand the digital shift. The Reserve Bank said in May it would help make cash more accessible for isolated communities and iwi, reported Te Ao Māori News, while the country’s five largest banks confirmed they would extend a commitment not to close regional branches for the next three years.