Could Cost Cutting Damage USPS?

January 15, 2013—If it ain’t broke, don’t fix it. Well, the USPS is beyond broke and it’s time they attempt to repair the damages. The United States Postal Service was ordered to pick up the pace for plans to restructure operation and cut costs. However, the Postal Regulatory Commission believes hurrying the process could in fact affect quality of service and universal postal service.

On Monday, the USPS announced the Postal Service Board of Governors has directed management to accelerate the restructuring of Postal Service operations. The goal is to reduce costs in order to strengthen Postal Service finances and the Board has approved restructuring initiatives to account for current financial and liquidity conditions. 

Chairman of the Postal Regulatory Commission Ruth Goldway expressed concern that accelerating the efforts by USPS could have disastrous effects. “I want people to know that if the Postal Service does move ahead quickly and citizens feel that their service has deteriorated to the point it is no longer meeting universal service obligations, they can come to the Commission and complain.” Goldway said the PRC has strength in its complaint process to direct the Postal Service to make changes. “If people have concerns, there is an option.”

Currently, the Postal Service has implemented major changes for cost reduction through retail, delivery, and mail processing operations. They even reduced its cost base by $15 billion and reduced the size of its career workforce. USPS continues to seek legislation to provide greater flexibility to control costs and generate new revenue, and wants congress to make postal reform legislation an urgent priority.

“The most important thing is that the Postal Service work with care to make sure that the quality of service and its universal service obligation are maintained while it is moving quickly to address the operating deficits that it has,” Goldway said.

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