JOC Staff | Jul 31, 2009 3:57PM EDT
A government audit says the financial viability of the U.S. Postal Service is at high risk as the USPS struggles to keep up with declines in mail volume reaching billions of pieces a year.
The Government Accountability Office raised its warning on the USPS’ financial condition to “high risk” this week, saying the drop in volume is unlikely to turn around after the recession because of changes in consumer mailing patterns.
The decline of 9.5 billion pieces in the USPS’ last fiscal year and 28 billion pieces in the current 2009 fiscal year will leave the USPS with a net loss of $7 billion this year, the GAO said, pushing the Postal Service’s outstanding debt to $10 billion. The USPS faces a $1 billion shortfall in cash that likely will grow next year as it faces another net loss.
The USPS has been trying to cut costs, but with hundreds of thousands of employees and enormous infrastructure — 38,000 facilities — supporting its universal mail delivery the Postal Service hasn’t been able to keep up with the growing move by consumers to electronic communications.
The agency faces questions about its “financial viability and its ability to provide sustainable, affordable, high-quality mail service,” said Gene L. Dodaro, acting comptroller general of the United States and the head of the GAO.
