FOR
IMMEDIATE RELEASE
Usps
Business Plan Needs A Major Overhaul
“Tinkering
Will Not Be Sufficient,” Gao Says
Postal
Service Business Model is “Unsustainable”
March
20, 2002
WASHINGTON - Four leading members of the Governmental
Affairs Committee, responding to a new analysis of the United
States Postal Service’s financial problems, urged the
Service to present a workable blueprint to lift itself out of
its cycle of debt.
Chairman Joe Lieberman, D-Conn., Ranking Republican
Fred Thompson, R-Tenn., along with Senators Daniel Akaka,
D-Hi., and Thad Cochran, R-Miss., reacted to a General
Accounting Office study that called the Postal Service’s
business model “unsustainable.”
In April 2001, GAO placed the Postal Service on its
list of government agencies most at risk of serious financial
mismanagement. In
May, the Committee adopted GAO’s recommendation that the
Postal Service submit a “transformation plan” that will
enable it to continue providing universal mail delivery and
reasonable postal rates.
That plan is due to be delivered to the Committee in
early April.
Lieberman said: “We
all know the Postal Service has a lot of problems, including
deficits, cash-flow pressures, rising debt, and liabilities.
Given this situation, the Service’s ‘transformation
plan’ has to be a serious blueprint for future solvency - in
other words, a complete overhaul of its financial operations.
The Postal Service is a key part of our national
infrastructure so we must continue to work with the Service,
unions, and the general mailing community until USPS’s
financial house is in order.”
Thompson said: “The Postal Service framework
established by Congress in 1970 appears to be near a breaking
point. We
established a system whereby the Postal Service would have
the
characteristics of both a federal agency and a business,"
Thompson said. “"This system worked for years, but
circumstances have changed.
The Service's 'transformation plan' provides a unique
opportunity for change. Capitalizing
on the comments of all interested parties, we look to the
Service to produce a plan that will begin to restore its
position to one of economic stability.”
Akaka said: “This report underscores the urgent need
to address what GAO calls the Postal Service’s
‘unsustainable business model.’
Evolving technology and the recent terrorist attacks
have changed the way that information is delivered.
Even before September 11th, the Postal Service was
experiencing a decline in volume, which has had a significant
impact on revenue. As
chairman of the Senate Subcommittee on International Security,
Proliferation, and Federal Services, I look forward to
comparing this GAO report with the Postal Service’s
transformation plan requested by this Committee.”
Cochran said: “This report will be helpful to us as
we exercise our oversight responsibilities.
It is essential that we continue to have the benefit of
dependable and affordable services from the U. S. Postal
Service.”
The Postal Service has projected a $1.35 billion loss
for 2002. That
projection was made before the anthrax-through-the-mail scare
last fall, which imposed enormous, new expenses on the
Service.
“USPS’s financial outlook is becoming increasingly
dire,” the GAO reports.
“Tinkering with the existing system will be
insufficient to produce a comprehensive transformation that
will enable USPS to fulfill its mission in the 21st
century.”
The Senators requested GAO in March 2001 to study the
cause of the Postal Service’s financial disarray and to
offer options the Service might take to improve its situation.
One of the recommendations was for the Postal Service to adopt
the “transformation plan”due next month.### |