Australia Post wants to raise the price of stamps to 60 cents. That would mean a 10 cent increase over two years. You know the story: population is growing, having an all points delivery system is mostly fixed costs, but the internet is killing post traffic. You need to recover the fixed costs from a smaller base and so prices rise. That is a good argument for the direction of the increase (I can’t say much about the magnitude) but it is also contributing to a death spiral as that price increase will only reduce post traffic further.
I am not sure what regulatory constraints the ACCC is working under but the issue here is that the stamp pricing itself is surely the problem. I’m not concerned about the subsidy from short distances to greater distances (that is, today just matching the competition). It is the focus on the envelope delivery price in contrast to the prices of delivering other physical packages.
What the ACCC should do in this review is consider pricing structure and whether it should be freed up or whether it should expect Australia Post to do better. I suspect that the stamp price cap is all about being able to offer certain discounts to business. What is probably required is a revenue cap on Australia Post (for all its services) with the stamp price fixed forever as a transitional mechanism. Put simply, that price is hardly reflective of what should be regulated in Australia Post in this changing environment.