A new report from the C.D. Howe Institute makes a compelling case that Canada Post’s exclusive grip on letter delivery has outlived its purpose — and that the time for serious reform is now.
A System Under Strain
In Untying the Gordian Knot: Reforming Canada’s Postal Market, economist Erik De Lorenzi argues that declining mail volumes, relentless competition in the parcel market, and over $6 billion in operating losses since 2018 have exposed deep structural flaws in how Canada’s postal system is governed. Recent cost-cutting measures — including ending door-to-door delivery and lifting the moratorium on rural post office closures — are simply not enough to restore long-term viability. As one former Canada Post CEO put it, the current framework offers “no clear path back to profitability”.
Breaking the Monopoly
At the heart of the report’s argument is a direct challenge to the assumption that letter delivery must be a government-protected monopoly. Advances in transportation, logistics, and technology have largely eliminated the economic rationale for exclusive postal privileges. The report recommends three core reforms:
-End Canada Post’s exclusive privilege over letter delivery and allow private operators to compete
-Create an independent postal regulator to provide oversight currently lacking in Canada
-Restructure universal service funding through targeted subsidies and competitive bidding, so rural and remote communities remain served without relying on monopoly revenues
Not Privatization — Competition
Critically, the report does not call for selling off Canada Post. Instead, it advocates a model where the Crown corporation remains publicly owned but competes on a level playing field with private carriers. This distinction matters: handing a private company a monopoly would simply shift the problem, not solve it. True competition, paired with stronger regulatory oversight and greater transparency, is what the report argues Canada’s postal market needs most.
For businesses — especially e-commerce sellers and logistics operators who depend on reliable, affordable delivery — this kind of reform could mean lower costs, fewer service disruptions, and a postal system finally built for the 21st century.
Do you agree that we need to see more players in the postal services sector in Canada?