The Government of Canada has announced plans to provide Canada Post with up to $1.034 billion in repayable funding by the 2025-26 fiscal year, offering a financial lifeline to the struggling Crown corporation as it grapples with mounting losses and operational challenges.
The funding, made under the Canada Post Corporation Act, is intended to ensure the postal service maintains its solvency and continues operations while a long-term plan is developed to address its structural issues.
According to the government, the measure is a temporary solution and does not resolve the broader problems that have led to Canada Post’s significant financial difficulties.
“This approach will maintain continuity of Canada Post's operations but will not solve the Corporation's structural issues,” the government stated.
“Significant change is urgently needed to modernize the operating model and preserve the national postal service.”
Canada Post has faced annual losses since 2018, driven by shifts in the postal and parcel delivery sectors, high labor costs, and regulatory constraints that hinder its ability to adapt and compete.
The corporation’s 2023 Annual Report revealed that without this financing, it would run out of cash reserves by the second quarter of 2025.
The funding will provide a financial bridge while Canada Post and the government collaborate on a plan to ensure the long-term sustainability of the service, which millions of Canadians rely on, particularly small businesses, charities, and residents in rural and remote areas.
In recent years, Canada Post has undertaken several initiatives to modernize its operations, including facility upgrades, new sorting equipment, digital platforms, and safety improvements for employees. Despite these efforts, the corporation continues to face financial strain due to its universal service obligation and rising costs associated with maintaining its network.
Canada Post has committed to working with the federal government to implement major changes aimed at meeting evolving delivery needs and achieving financial self-sustainability. However, both the corporation and the government acknowledge that addressing its structural challenges will require bold and urgent action.
