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Abolishing home mail delivery: the prelude to privitization.

THE CANADA POST GROUP recently reported huge profits from operations to the tune of $299 million for 2014, including pre-tax profits of $194 million for the Canada Post segment.

According to Canadian Union of Postal Workers national president Denis Lemelin, recent cuts in services haven't yielded real savings. And that's not a surprise because the intention isn't really to save money but rather to dismantle a public service and leave the field open to the private sector.

It was no accident that the crown corporation took such a hard line with the union in 2011. In league with the Harper government and Lisa Raitt, then federal labour minister, Canada Post CEO Deepak Chopra orchestrated the conditions for the adoption of back-to-work legislation. That made it possible to impose even lower wages and poorer working conditions than what could have been negotiated--actually a worse deal than what the employer had offered. The main objective of attacking the union was to quell resistance to service cuts and privatization.

Successive efforts by Conservative and Liberal governments over the last 30 years to undermine public postal services have been aimed at commercializing Canada's postal system, abandoning its role as a universal public service and opening it up to market competition. That included making Canada Post pay tax on revenues and dividends to the government. In spite of this, over the 15 years prior to 2011, Canada Post registered profits of $1.7 billion and paid the federal government $1.2 billion in dividends and income tax before posting deficits in 2012 and 2013.

Private corporations, on the other hand, enjoy generous subsidies for which taxpayers ultimately foot the bill. Medium-size companies with taxable capital of less than $50 million have benefited from the elimination of the federal capital tax since 2004. In addition, the general federal corporate income tax rate fell from 28 per cent in 2000 to 15 per cent in 2013. According to the Canadian Labour Congress, cash reserves increased by $72 billion in 2010-2011 alone, at a time when the federal government reported a deficit of $33 billion. How then are we to understand the concept of profitability? The government's definition is evidently quite flexible, depending on what its priorities are and whose interests it is representing.

False panacea

According to a Conference Board of Canada study, doing away with urban home mail delivery should yield substantial savings for Canada Post, amounting to $576 million by 2018. But what about the social and economic impact of eliminating between 6,000 and 8,000 jobs? We are talking about thousands of people earning decent wages in both urban and remote areas and who contribute to the vitality of their local economies. In 2012, those wages totalled $4 billion, or 0.2 per cent of Canadian GDP, according-to the Institut de recherche et d'informations socio-economiques.

The C.D. Howe Institute and the Fraser Institute tout privatization as a panacea, but the reality is much more complex. In a country as big and sparsely populated as Canada, public funding is essential to maintain universal mail delivery and therefore a privatized postal system would still require government subsidies to maintain the service.

It's a matter of political will. A government determined to pave the way for privatization will always find a pretext to apply its selective criteria of profitability. Meanwhile, there are apparently no spending limits on Canadian participation in war, as the Harper government multiplies Canada's military interventions from Afghanistan to Iraq, Syria and now the Ukraine. In the final analysis, it all comes down to the kinds of choices we make as a society.

Translated by Andrea Levy.

ANDRE FRAPPIER has been a member of the FTQ Montreal Labour Council for many years and serves on the editorial board of the online newspaper Presse-toi a gauche. Andre ran for Quebec Solidaire in the riding of Cremazie.
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Title Annotation:Quebec Communique
Author:Frappier, Andre
Publication:Canadian Dimension
Date:May 1, 2015
Words:643
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