The Postal Service just released its financial figures for the first fiscal quarter of 2014 (Oct.-Dec.) and more than 100 percent of our losses are the onerous prefunding of retiree health care. The Postal Service would have earned a profit of $765 million if not for the prefunding albatross that is crippling the Postal Service. Operating revenue is increasing and operating expenses are decreasing indicating the Postal Service is headed in the right direction.
I want to emphasize the last three important financial figures of the Postal Service:
- 2013 Fiscal Year – $600 million profit without prefunding (Oct. 2012 – Sept. 2013)
- 2014 Fiscal Year First Quarter – $765 million profit without prefunding
- January 2014 – $122 million profit without prefunding
Bottom line – Last 16 months the Postal Service has made almost $1.5 billion in profits without the prefunding mandate.
The Postal Service’s unmatched networks and outstanding employees have made these striking results possible. And these trends augur well for the future, because they reflect the opportunities increasingly presented by the Internet and by an improving economy. Package revenues resulting from online shopping rose by more than 14 percent this quarter — more than offsetting the small decline in letter revenue.
This quarter’s $765 million operating profit compares with the $100 million from the first quarter of 2013 — another sign of improving postal finances.
In light of these results, lawmakers should strengthen the postal network while addressing the remaining problem: the congressional mandate to prefund future retiree benefits required of no other public or private entity in the country. Degrading the network and reducing services to the public and businesses would jeopardize the postal turnaround.