VMA CALLS AUSPOST RISE DISAPPOINTING

The ACCC has not objected to Australia Post’s proposed 13.3 per cent price increase, to take effect in July 2025, for its reserved ordinary letter service delivered to the regular timetable, which the Visual Media Association (VMA) has called a disappointing outcome.

Unless the Minister for Communications disapproves the proposed increase, the price for ordinary small letters – known as the basic postage rate – will increase from $1.50 to $1.70.

Prices for ordinary large letters up to 125g will increase from $3 to $3.40, and ordinary large letters between 125 and 250 grams will rise from $4.50 to $5.10.

The price of concession stamps ($3 for five) and stamps for seasonal greeting cards (65 cents) will not change.

“The Mail Industry Coalition worked very hard across the discussions with the ACCC and we were disappointed with the outcome," Kellie Northwood, chief executive officer of the VMA, told Print21.

"The challenge is always that the Business Mail oversight from the ACCC is no longer, which means their remit to address our concerns is extremely limited. Therefore, the only opportunity for the industry voice to be heard is directly with the Minister and in our discussions with Australia Post.

"With the recent change to the Minister for Communications, we are preparing our industry summary, including an industry forecast across the letterbox sector, and working with Australia Post to address opportunities for operational and regulatory relaxation to reduce costs for our mail industry members in their mail preparation.”

According to Northwood, there are some concerns about the understanding of the role of the letterbox across Australian society, and in particular, the important role mail plays across regional Australia.

"To that end, we have invested in research to explore the societal role of mail to provide insight to the government to assist in their understanding moving forward. This research will expand our Open Up to Mail campaign and we encourage all across the mail industry sector to visit the website and participate in the research webinars," Northwood added.

"A CMO Lunch is also being hosted for all the major mail marketers and users across the customer sector, which will be important to share the ROI and impressive response rate of mail.”

According to the ACCC, Australia Post’s letter services – including its reserved services – have incurred significant losses in recent years, which Australia Post attributes primarily to the ongoing reduction in letter volumes combined with an increase in delivery points.

In a submission to the ACCC, Australia Post said its letters business is in decline, and that currently it only delivers around two letters to each household per week. It expects reserved letter volumes to continue to decrease by around 10.6 per cent annually until 2027–28.

“We understand that these price increases will mean extra costs for consumers. However, our decision to not object to Australia Post's proposed price increase is based on evidence that the costs to Australia Post of providing the letter service are greater than the revenue it produces,” said Anna Brakey, ACCC Commissioner.

As outlined in the ACCC’s April 2025 preliminary view on Australia Post’s draft proposal, the ACCC found that Australia Post is unlikely to recover revenue in excess of its costs for reserved postal services, even with the proposed price increase. The ACCC’s final decision was formed in line with its role for postal services and follows a public consultation process on the preliminary view.

“Our final decision recommends Australia Post examine ways to alleviate affordability issues for businesses, including those subject to requirements to send physical mail. Further, we made recommendations to address a number of other concerns expressed by stakeholders during consultation,” explained Brakey.

“We are especially mindful of the impact price changes can have on vulnerable Australians, and so our decision paper recommends that Australia Post increases the number of concession stamps per customer, which is currently capped at 50 per year.”

The ACCC said that the bulk of its recommendations are designed to improve the quality of information provided by Australia Post in support of its price notification submissions, particularly in relation to forecast data and Australia Post’s cost allocation model.

“While Australia Post has been working constructively with the ACCC on these recommendations, in most instances, we expect full implementation to be reached, so that we can conduct rigorous cost-based assessments going forward,” Brakey said.

“As there are many businesses in Australia that still rely on sending letters, it is crucial that Australia Post has a transparent dialogue with these customers so they are aware of potential pricing changes well ahead of time.”

Australia Post’s proposed price of $1.70 for a single postage stamp is below the current median price of $1.93 among OECD postal service operators.

The ACCC does not approve or reject notified letter price changes – only the Minister for Communications has the power to reject a stamp price increase.

The final decision paper and an accompanying fact sheet are available on the ACCC website.