An Post’s decision to increase the price of a stamp for the fifth time in four years has been positioned as an inevitable and unavoidable consequence of declining mail volumes and rising costs.
The State body argues that the cost of providing the infrastructure capable of next day delivery to every address in Ireland is fixed while operating costs such as wages are rising. Revenue on the other hand is falling as fewer and fewer send letters. Volumes are down over 8 per cent in the last 12 months, 40 per cent since 2017 and 50 percent in the last decade.
The latest 25c increase brings the price of a national stamp to €1.65 which, An Post says, is still below a benchmark for 14 EU countries and the UK of €1.88. A postage stamp in Denmark will set you back €5.23 they point out.
It appears to be a compelling argument and the increase seems to have been quietly accepted. Leaving aside the lack of context to the international comparisons, the weakness in An Post’s argument is that the fixed and operating costs of letter delivery are shared with other parts of the business which it claims are doing very well, notably parcel delivery and a financial services joint venture that operates through its post offices.
Its most recent figures show revenue growth of 4 per cent to €923 million in 2023, with parcel delivery growing by 14 per cent and increased footfall it its network which it said offset declines in traditional letter volumes.
At a minimum, An Post needs to provide a more detailed rationale for the latest price increase or leave itself open to the charge of raising prices just because it can in the current climate. The company would argue that the increase was independently assessed and is consistent with regulatory and other governance obligations.
Letters are clearly now the least important part of An Post’s business but they remain a social virtue. They are an important service for many and for some are a vital connection to an increasingly isolating world. An Post should be careful not to hasten their demise.
