Australia Post lodges notification of price increase for letter services with ACCC

28 August 2015

The Australian Competition and Consumer Commission will assess a draft proposal lodged by Australia Post to increase the price of its ordinary letter services, including stamps.

Australia Post is proposing to introduce a basic postage rate of $1 for letters delivered at a new timetable, which allows up to an extra two business days for delivery to occur. Postage stamps for letters delivered at the current timetable cost 70 cents.

The Australian Government recently regulated to allow the introduction of a two-speed letter service by Australia Post, which will distinguish between letters delivered at a priority and regular timetable.

Australia Post’s proposal also includes price increases for the delivery of large letters. They are not proposing to increase the price of concession stamps or stamps for seasonal greeting cards.

“The ACCC’s role is to assess Australia Post's proposed price increases. We will take into account various factors including how efficient it is in managing the impact of declining letter volumes and the extent to which price increases are required,” ACCC Chairman Rod Sims said.

“The ACCC welcomes submissions on Australia Post’s proposal. In reaching its view, the ACCC will consider information provided by industry stakeholders, consumers and Australia Post,” Mr Sims said.

The ACCC does not have the role of approving the proposed price increase. Rather, the ACCC is required to assess the proposed price increase in accordance with the Competition and Consumer Act (2010) and then notify Australia Post as to whether it objects to the proposed price increase.

In addition to the ACCC’s assessment, Australia Post must give written notice to the Minister for Communications of its intent to vary its rates of postage. Australia Post may increase the basic postage rate only if the Minister does not disapprove the proposed increase to the BPR within 30 days of receiving notification from Australia Post.

The ACCC intends to release its preliminary view on Australia Post’s proposal in November 2015 and a final decision in December 2015. Australia Post intends that the proposed prices would take effect from 4 January 2016.

The ACCC will soon release an Issues Paper providing further information on the proposal and review.

How to make a submission: Australia Post - letter pricing 2015.

Release number: 
MR 157/15
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