NZ Post has secured agreement from the Government allowing it
to move to three day a week letter deliveries from 2015, but
rural areas will retain their current services.
Communications Minister Amy Adams confirmed the Government
had reached agreement with NZ Post on changes to the mail
service's Deed of Understanding, "to ensure the postal
service remains viable''.
NZ Post has been signalling the need to make changes to its
delivery services in the face of plummeting letter volumes.
But suggestions of moving to three day a week deliveries
raised alarm bells among rural communities.
"Through negotiations, I have secured agreement from New
Zealand Post that it will limit any introduction of a minimum
three-day delivery to only urban areas, maintaining five-day
delivery in rural delivery areas," Ms Adams said in a
"It is important to note that three-day delivery is the
minimum standard New Zealand Post must meet. This means that
New Zealand Post may continue to provide a higher frequency
of delivery in some non-rural areas.''
The minimum standards in the deed will only apply to basic or
standard postal services and not other types of postal
products or services such as express mail, courier post,
parcel post or premium services such as Fast Post.
Changes to the Deed would also require New Zealand Post to
continue to maintain a retail network of at least 880 "points
of presence'' but allows for some of those to be self-service
kiosks as well as physical postal outlets.
NZ Post had agreed to maintain at least 240 outlets where
customers could receive personal assistance from an employee
or agent of New Zealand Post.
"This will give comfort to members of the public who may feel
anxious at the prospect of the introduction of self-service
kiosks," Ms Adams said.
The timeframe for implementing the changes to the deed was a
commercial decision for NZ Post after 30 June, 2015.
NZ Post chief executive Brian Roche said the new deed gave
the company the flexibility it needed to continue providing
New Zealanders with a postal service "that meets their
changing requirements and expectations''.
"The flexibility means while New Zealand Post is committed to
providing an across the week premium mail service we have
room to move in the years ahead on the frequency of standard
He said the change in delivery frequency was inevitable given
the ongoing and rapid decline in letter mail volumes.
While parcel volumes had increased by nearly 3 million since
2006, over the same period letter volumes dropped by 322
million - or 30 per cent.
"The changes also recognise that technology such as
self-service kiosks will form a significant part of our
postal service point network, and a move towards a franchise
and hosted business model.''
Ms Adams said current minimum service levels for rural areas
would be maintained because "the reality is that in the in
the rural and urban areas the dynamics are different and it's
much harder to maintain a viable postal business on a three
day a week basis than in the rural areas".
"Similarly of course we have to take into account the impact
on those communities and there can be no doubt that rural
communities are more reliant on postal services than perhaps
some of their urban neighbours."
Ms Adams said almost 90 per cent of submissions received on
the proposed changes related to the rural services.
She said NZ Post had told the Government that without the
move to three day a week deliveries, "they would be looking
to the Government for subsidies that could well be in the
range of $30 million a year or more".
"As mail volumes continue to decline I'd imagine that number
would continue to increase."
She said it was "an inescapable fact" that around the world
mail volumes were dropping.
"Of course when you have a small population spread across a
big country it perhaps hits the critical point sooner in New
Zealand than in other places."
The Engineering, Printing and Manufacturing Union (EPMU)
which represents some postal workers said the changes
announced today "herald massive cuts to postal services".
EPMU postal industry organiser Joe Gallagher said the union
was "incredibly disappointed with this decision, and how it
has been made".
"New Zealand Post is a vital public service which returned a
profit of $121 million in 2013. It should be focused on
delivering for Kiwis, not cutting essential services to turn
"We have not had any answer to our questions about the
figures this decision is based on, and we have to ask why the
Government has decided to let urban services be cut in half
while the rural sector is kept to five days a week."
Ms Adams confirmed that the move will cost jobs but said it
was for NZ Post to comment on how many losses might occur as
- By Adam Bennett of the NZ Herald