The federal government announced today major changes to Canada Post aimed at stemming billions in losses and modernizing its operations, including ending door-to-door delivery and lifting a decades-old ban on closing rural post offices.
“Canada Post is a national institution, older than our country itself, that has been serving Canadians for more than 150 years,” said Joël Lightbound, Minister of Government Transformation, Public Works and Procurement, in a Sept. 25 statement. “Canadians continue to rely on it today, and it remains a vital public service. At the same time, Canada Post is now facing an existential crisis.”
Since 2018, the Crown corporation has lost more than $5 billion. In 2024, it posted a $1-billion loss, and by mid-2025 was already on pace to lose close to $1.5 billion. Earlier this year, Ottawa injected $1 billion to keep the postal service afloat, but Lightbound stressed that “repeated bailouts are not a long-term solution. Transformation is required to ensure the survival of Canada Post and protect the services Canadians rely on.”
Among the reforms announced:
LETTER MAIL DELIVERY STANDARDS – Non-urgent mail can move by ground instead of air, saving an estimated $20 million annually.
COMMUNITY MAILBOX CONVERSIONS – The government will lift the moratorium on conversions, allowing the last four million door-to-door addresses to shift to community mailboxes, expected to save $400 million each year.
POSTAL NETWORK MODERNIZATION – The moratorium on rural post office closures, in place since 1994 and covering nearly 4,000 locations, will end. Canada Post must return with a plan to “modernize and right-size” its network.
The government will also review the process for increases to the stamp rate to “modernize and shorten it,” in line with recommendations from the Industrial Inquiry Commission led by William Kaplan.
Lightbound said these measures follow Kaplan’s May report, which identified the scale of the challenge and recommended a path forward.
“Canada Post is effectively insolvent,” the minister said, adding that parcel volumes have dropped sharply, with market share falling from 62 per cent in 2019 to below 24 per cent today. “Canada Post must take decisive action to deliver the services Canadians need in a way that is financially sustainable.”
Canada Post President and CEO Doug Ettinger welcomed the reforms, framing them as critical to ensuring long-term stability.
“Today’s announcement will allow us to make the changes needed to restore Canada’s postal service for all Canadians by evolving to better meet their needs. We take this responsibility seriously and will work closely with the government and our employees to move with urgency and implement the necessary changes in a thoughtful manner. Our goal is to ensure that a strong, affordable, Canadian-made, Canadian-run delivery provider supports the needs of today’s economy and delivers to every community across the country,” Ettinger said.
REMARKS TO REPORTERS
Speaking with reporters after the announcement, Lightbound provided more detail about how the reforms will roll out. He said the community mailbox conversions would be phased in over up to nine years, with “the bulk” occurring within the next three to four years. He emphasized that Canada Post remains obligated to serve all Canadians, including rural, remote, and Indigenous communities, and he has asked the corporation to return within 45 days with a detailed plan on implementation, impacts on workers and customers, and protections for rural and Indigenous service.
The minister also noted that Ottawa’s goal is to limit additional public funding, requiring Canada Post to find efficiencies and “lighten” its management structure. He framed the choice as one between ongoing taxpayer bailouts and reforms that reflect how Canadians now use the mail: “We’re beginning the work today” to return the postal service to financial viability, Lightbound told reporters.
CUPW REACTION
The Canadian Union of Postal Workers (CUPW) expressed concern ahead of the announcement, criticizing Canada Post for failing to consult with the union in advance. In a Sept. 24 bulletin, National President Jan Simpson said, “Canada Post has yet to confirm this with the Union,” adding that the timing of the government’s move suggested management had “no intention to achieve negotiated collective agreements.”
CUPW has also called for any government review of Canada Post’s future to be fully public and transparent, with hearings held across the country. The union argues that reforms affecting delivery standards, community mailbox conversions, and rural post offices risk undermining service in the very communities most dependent on the postal system.
Union leaders have pledged to mobilize members and communities in the coming months as Ottawa proceeds with its Canada Post mandate review. “If they ignore the overwhelming vote to reject their vision … they are proving they have no intention to achieve negotiated collective agreements,” CUPW warned in its pre-announcement communication.
LOOKING AHEAD
While transforming such a large institution will take time, Lightbound described the government’s measures as “the first step toward securing a future where Canadians deserve a service that is reliable, affordable, and sustainable.” CUPW, meanwhile, has made it clear that it will fight to defend door-to-door delivery and rural services, setting the stage for a potentially contentious debate over the future of Canada’s postal system.