Australia Post price hike to hit everyday Aussies sparks backlash: 'Out of control'
Australia Post is copping backlash after the consumer watchdog approved its request to raise prices by 13.3 per cent. The national postage service asked the Australian Competition and Consumer Commission (ACCC) back in November if it could raise the cost of certain services as it battled multi-million dollar losses.
The ACCC has decided not to oppose the proposal, meaning the price of some letters will rise by up to 60 cents from July 17. ACCC Commissioner Anna Brakey said while it will mean higher costs for everyday Aussies, it's essential to keep the postal service running.
"Our decision to not object to Australia Post's proposed price increase is based on evidence that the costs to Australia Post of providing the letter service are greater than the revenue it produces," she said.
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"Further, we made recommendations to address a number of other concerns expressed by stakeholders during consultation.
'We are especially mindful of the impact price changes can have on vulnerable Australians, and so our decision paper recommends that Australia Post increases the number of concession stamps per customer, which is currently capped at 50 per year.'Australia Post proposed an increase in the price of certain letters, which will now kick in next month:
Ordinary small letters will go from $1.50 to $1.70 (20 cents hike)
Ordinary large letters up to 125g will go from $3.00 to $3.40 (40 cents hike)
Ordinary large letters between 125 and 250 grams will go from $4.50 to $5.10 (60 cents hike)
Brakey said the proposal to make an ordinary letter cost $1.70 was still below the current median price of $1.93 among OECD postal service operators.
It comes after a 30 per cent hike in ordinary small letters in April last year.
The price of concession stamps (which is $3 for five) and stamps for seasonal greeting cards (65 cents) won't be affected by this change.
Australians weren't happy at the thought of forking out more of their cash to send a basic letter around the country.
Many flocked to social media in the wake of the news to vent their frustrations over the extra 60 cents.
"What a joke!" wrote one person.
"The price rise is because the majority don't send letters anymore. This just penalises those who still do. There comes a time when we have to let the past go," added another.
"Everything just getting out of control price with everything is going up and it's going to get harder for everyone," said a third.
The ACCC held a public consultation period before deciding not to oppose Australia Post's proposal.
The only person who can now stop the price increase before the July 17 change is Anika Wells, the federal minister for communications.
AusPost said in its submission it had been struggling in recent years as fewer people were sending letters.
This is a shift occurring across the world and Australia's postal service only delivers around two letters to each household per week.
This is expected to drop by more than 10 per cent every year until 2027-28.
As a result, it's hoping a small price increase will alleviate this downward trend.
Even though it's only been a little more than 12 months since the last price hike, along with a huge overhaul in the letter delivery system where the frequency was amended to every second day, Australia Post still incurred a $361.8 million loss in the 2023-24 financial year.
AusPost said in its submission to the ACCC that it expects these losses to "grow substantially" from the 2025-26 financial year "unless further price increases are implemented".
Even with this latest price increase, the ACCC said AusPost was 'unlikely' to recover revenue over its costs.Sign in to access your portfolio
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