Postal Service Plans to Stop Delivering on Saturday 07 Feb 13

For years the U.S. Postal Service has discussed cutting back to a five-day delivery schedule, but as of a Wednesday announcement by Postmaster General Donahoe it seems the plan is finally going into effect. The new schedule, set to begin in August, will eliminate all mail delivery on Saturday; although the Post Office will continue to distribute packages six days a week.

Mail officials say the increased use of email and other technological services has caused a lower demand for letter deliveries, whereas the sending of packages has gone up by 14% since 2010. The planned delivery system intends to better match these changing needs while saving the cash-strapped Post Office around $2 billion annually.

“The Postal Service is advancing an important new approach to delivery that reflects the strong growth of our package business and responds to the financial realities resulting from America’s changing mailing habits,” Donahoe said in a statement prepared for the announcement. “We developed this approach by working with our customers to understand their delivery needs and by identifying creative ways to generate significant cost savings.”

Although homes and businesses will only receive letter mail Monday through Friday, post offices will remain open on Saturdays and still disperse mail to post office boxes.

The U.S. Postal Service receives no tax dollars to maintain its daily operations yet remains under congressional control. Congress has repeatedly denied the mail service’s requests for a five-day delivery schedule of letters and packages, but the Post Office feels its new plan, which doesn’t shutdown all Saturday services, can move forward without the need to create new legislation.

In November the USPS reported an annual loss of $15.9 billion, defaulted on billions in retiree health benefit prepayments, and predicted further losses for 2013. The agency says its monetary problems don’t stem from a reduction in mail flow but from the $55 billion Congress is forcing it to squirrel away to cover future medical costs for retirees.

Postal authorities complain that no other government agency is required to make such large prepayments ($5.5 billion for ten year) for future benefits, but after getting nowhere with Congress, the USPS decided to take matters into its own hands with the Saturday cutbacks and other restructuring.

“If the Congress of the United States refuses to take action to save the U.S. Postal Service, then the Postal Service will have to take action on its own,” said corporate communications expert James S. O’Rourke, professor of management at the University of Notre Dame.

Not all are pleased by the Post Office’s move and feel it will have a negative impact on millions of customers.

President of the National Association of Letter Carriers, Fredric Rolando, said the end of Saturday mail delivery is “a disastrous idea that would have a profoundly negative effect on the Postal Service and on millions of customers,” particularly businesses, rural communities, the elderly, the disabled and others who depend on Saturday delivery for commerce and communication.

Despite moving forward on its own, the U.S. Post Office intends on continuing to push legislation that will give it greater decision making control.

http://news.yahoo.com/postal-cut-saturday-mail-trim-costs-121737834–finance.html