Washington - The Postal Service is expected to announce on Wednesday morning that it will stop delivering letters and other mail on Saturdays, but continue to handle packages, a move the financially struggling agency said would save about $2 billion annually as it looks for ways to cut cost.
The agency has long sought Congressional approval to end mail delivery on Saturdays. But Congress, which continues to work on legislation to reform the agency, has resisted. It is unclear how the agency will be able to end the six-day delivery of mail without Congressional approval.
News of the move was first reported by CBS News.
The announcement, which is expected at a Wednesday morning news conference, comes as the agency continues to lose money, mainly due to a 2006 law which requires it to pay about $5.5 billion a year into a future retiree health benefit fund. Last year, for the first time, the agency defaulted on two payments after it had reached its borrowing limit from the Treasury Department. The Postal Service also continues to see a decline in mail volume as more people shift to electronic forms of communication like e-mail and online bill paying services. Packaging is one of the few areas where the agency is seeing growth.
While many business and postal unions have generally opposed ending Saturday delivery, most Americans support the move.
A New York Times/CBS News poll last year found that about 7 in 10 Americans say they would favor the change as a way to help the post office deal with billions of dollars in debt. The Postal Service continues to suffer losses of $36 million a day and is headed for projected losses of about $21 billion a year by 2016. Last year, the Postal Service had a net loss of $15.6 billion.
The American Postal Workers Union, which represents about 220,000 workers and retirees, said the plan to end six-day delivery will add to the agency’s financial problems.
“The A.P.W.U. condemns the Postal Service’s decision to eliminate Saturday mail delivery, which will only deepen the agency’s congressionally manufactured financial crisis,” said Cliff Guffey, president of the union.