Government Operations Committee on May 29th, 2024

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Thank you, Chair.

Just to clarify the structure that you operate under, you're the CEO of Canada Post, which means that you exercise a lot of authority over operations, but you're ultimately constrained by policy that's put in place by the government.

You talked in general terms about modernization, but I challenge you to be as specific as possible. Let's imagine a world in which you don't have the kinds of constraints that you have as a result of working within a Crown corporation, or that you can actually do whatever you think is best to restructure the company. Can you tell us, specifically, what kinds of more innovative and even radical measures you would undertake, if you didn't have those constraints, along the lines of modernization?

[Doug Ettinger]

Again, I'll go back to what I talked about earlier. The market has changed so much. The expectations of Canadians and customers have changed so much.

Coming out of COVID with all these new upstarts has changed the game completely. They are much more flexible than we are. They're 24-7. There was a delivery on my street—not for me—on Easter Sunday and on Labour Day Monday. These low-cost, non-union players are much more flexible than us.

Again, I would come back to the word “flexibility”. I'm sorry. We need more flexibility on how we deliver. All of our competition is doing weekend delivery. Right now, we're the only ones who aren't. That has to change.

We're talking to our bargaining agents about that right now. Those negotiations are under way, so I can't talk about that any further, but—

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

To prove that point specifically, how would weekend delivery reduce your costs? It would seem, on the face of it, that it would increase your costs.

[Doug Ettinger]

It will grow revenue. A weekend right now is not huge, but it's going to be. It's become the norm. If you remember when we opened Sunday shopping many, many years ago—

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Would that involve charging more for weekend delivery, then? Or would it involve the same rate—

[Doug Ettinger]

Not necessarily, but when you're dealing with customers, it's so important that their end-consumer gets that product quickly, even if it's on Saturday morning or Sunday night.

They won't work with us—

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Therefore, they'll be more likely to work with you as opposed to others, if—

[Doug Ettinger]

Thank you. That's it. You have to be in that game. You have to be competitive. You have to be flexible.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

What else? What other kinds of radical changes would you consider?

[Doug Ettinger]

There are so many innovative things. We look and continue to look at all of the things that are happening around the world, such as parcel lockers. We're adding technology right now to the community mailboxes to let people know when there's something in there so they don't have to drive up, check and hope there's something there.

There's a lot of technology that we can bring to the table that can change the game for us in terms of better efficiency, better customer engagement and all of those things.

There are so many possibilities, including pricing. We need a pricing structure model that enables us to get reasonable pricing based on where inflation is on an annual basis so we don't have to go through that whole process.

Other countries are now doing that. They're setting up models whereby you work to a calculation each year based on inflation and other costs. For example, the United States—this is really new—now gets two opportunities for price increases every year. Their stamps were notoriously low-priced, the lowest in the world. They're about to go right past us pretty quickly. They're using that as a way to turn around their company in the United States, as one example.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

To make these changes—taking you out of that imaginary world where you get to make all of these decisions yourself—are you bringing these kinds of ideas to the government? What kind of responses are they giving you on the weekend delivery piece or on the price piece?

[Doug Ettinger]

Weekend delivery is something we have to work out with our bargaining agents. We have constant conversations with the department, PSPC. I talk to the minister and his deputy minister on a regular basis. The communication lines are very good, but we have not been able to align on all of the right solutions.

I'm not saying that we're perfect. We may have missed a couple of things, but we know what's going on around the world, and we know what's working.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Yes. In terms of aligning, I understand that the minister may not agree with you on certain particulars. Obviously that's the minister's prerogative. The minister is responsible ultimately to the people of Canada for the decisions that are made.

On the lack of approval for the strategic plan going back years and years, it seems like there's a problem being able to make a decision on any kind of direction from the minister.

How do you explain the lack of approval on a strategic plan, that seemingly ongoing misalignment, and the failure to identify solutions between Canada Post and the political decision-makers?

[Doug Ettinger]

Yes, thank you—

[The Chair, Conservative, Kelly McCauley]

I am sorry to interrupt, but there is no time left for an answer. Perhaps in the next round for the Conservatives, you can take time then.

Mr. Bains, go ahead.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

If you just hold on to that, you can answer it during my next round.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

Thank you, Mr. Chair.

Thank you, Mr. Ettinger, Madam Fortin and Madam El-Hage, for joining us today.

I would also like to echo my colleagues in recognizing our hard-working postal workers who serve our communities across Canada. In fact, a childhood friend of mine, Paul Bahia, is nearing his 25 years of service. He is a beloved member of our community in Richmond, British Columbia. He has coached over 3,000 kids in youth soccer. Even the dogs love him.

[Voices]

Oh, oh!

[Parm Bains, Liberal, Steveston—Richmond East, BC]

On the issue of stamps, I want to share a really proud moment for the Sikh Canadian community. A stamp was made to celebrate the contributions of the community in 1999. It was a very proud moment for the community. Thank you again for recognizing that.

My question is around the greening government strategy, the approach to meeting or exceeding national climate objectives in its own operations—reducing the climate and environmental impact of federal government operations, supporting the sustainability goals, reducing greenhouse gas emissions, and the resilience of assets, services and activities through climate adaptations.

As part of this strategy in its operations to be net zero by 2050, has Canada Post taken any measures to reduce its emissions and improve the sustainability of its organization? Can you talk a little bit about that?

[Doug Ettinger]

Thank you for that. It's another great question.

Yes, we've taken it extremely seriously. It has been in our mandate letters. We've embraced it as an organization. It's an important part of our brand. I'd say we've made good progress, but we're on a journey that is a long journey, so we're nowhere near where we need to be.

I'll give a couple points of evidence around that. The Albert Jackson Processing Centre is very much a green-certified building for its size in Canada. It's a huge facility. It has solar panels on the roof. It has electric charging stations, etc. Also, we scorecard and monitor and are working on a number of programs around our environmental performance. We brought down our scope 1 and scope 2 GHG emissions by 17% last year. We have actual numbers that are on my scorecard in terms of progress. We launched a new product last year called “carbon-neutral shipping”. Basically, it's ground shipping that still emits carbon, but it's a lot less than other alternatives.

We're very pleased with those. We've been recognized by a number of bodies for our actions—not just our talk, but our actions—in that regard in terms of the environment. As I said, it's an important part of our brand. It's something we're committed to. At the same time, the financials concern me deeply. We have to bring the financials into line, and we intend to. On the ESG side, the environmental side, we're pleased with where we are.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

Is that impacting, say, the fleet in any way?

[Doug Ettinger]

Yes. Thank you. We have one of the largest fleets in Canada, if not the largest. People may not realize that. We have about 14,000 vehicles. We've committed to converting those to electric by 2040. We've started to phase them in, in a small way. We have a long way to go, but we're very pleased with that so far.

We're learning a lot on that. The big thing with electric vehicles is the infrastructure. You have to get the infrastructure in properly. There's a lot of learning there. We're learning as we're going, but we're very committed to that, yes.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

Thank you for that.

With respect to the rural and remote communities and the indigenous communities who often live in a lot of these rural communities, in terms of the need to ensure the access and the range, Canada Post recognizes this obligation as part of its commitment. Can you explain how Canada Post approaches reconciliation?

[Doug Ettinger]

Yes.

[The Chair, Conservative, Kelly McCauley]

You have about 25 seconds, please.