Friday, November 16, 2012
Federal Daily News
- By FederalDaily Staff
- November 15, 2012
The United States Postal Service reports that in fiscal 2012, while revenue from its package services business grew and productivity reached record levels, a requirement to prefund retiree health benefits resulted in the agency reaching its statutory debt ceiling for the first time ever.
The agency reported that in fiscal 2012, ending Sept. 30, it lost a record $15.9 billion, including $11.1 billion related to retiree health benefits prefunding payments -- which it was forced to default on -- and expenses related to the long-term portion of workers’ compensation.
Without those two expenses, the agency said it would have reported a net loss of $2.5 billion in the latest fiscal year. By comparison,USPS reported a net loss of $5.1 billion for the same period last year.
“It’s critical that Congress do its part and pass comprehensive legislation before they adjourn this year to move the Postal Service further down the path toward financial health,” Postmaster General and CEO Patrick Donahoe said.
“We continue to do our part to grow revenue and reduce expenses by making our operations more efficient and by providing ourcustomers with new and expanded services to meet their mailing and shipping needs," he added.
USPS said that revenue from package services business continues to grow, reporting an increase of $926 million, or 8.7 percent in fiscal 2012, compared to the same period last year.
In addition, Joseph Corbett, USPS chief financial officer, is crediting a reduction in work hours with a record level increase in productivity.
“Since 2000, we have reduced work hours by a cumulative total of 504 million work hours, equivalent to 286,000 employees, or $21 billion in expense savings each year,” he said.
Besides requesting that Congress address the prepayment requirement, USPS is asking lawmakers to allow the agency to make changes to mail delivery frequency, provide non-postal services, and address overfunding of its obligation to the Federal Employees Retirement System.
Donahoe and Corbett held a financial briefing Nov. 15 to discuss the financial stability of USPS.