US Postal Service in $16bn loss

The entrance of a United States Post Office is seen in Manhasset, New York 1 August 2012 The US Postal Service has seen declining mail volume but increases in shipping services

The US Postal Service has reported an annual loss of a $15.9bn (£10bn), ending a year in which it defaulted on payments twice to avert bankruptcy.

Its financial losses were more than triple the previous year's.

Most of the mail agency's financial woes come from mounting mandatory costs for future retiree health benefits.

Postmaster General Patrick Donahoe said the Postal Service's hands are tied by congressional inaction on a bill that would allow it to reduce the payments.

"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," Mr Donahoe said, calling the situation "our own postal fiscal cliff".

One version of the bill would cut down on the required $5bn annual health-benefit payment and allow it to eliminate Saturday mail delivery.

Earlier in 2012, the Postal Service defaulted for the first time in its history on two of the health payments.

The Senate passed a postal bill in April that would have reduced the mandatory advances and refunded overpayments to a federal pension fund.

But legislation proposing an end to Saturday delivery has stalled in the House of Representatives.

The mail agency has seen other structural problems in declining mail volume, but has seen growth in it shipping services, up 9% in 2012.

Fredric Rolando, president of the National Association of Letter Carriers, blamed Congress for mandating the annual health pre-payments in 2006, but suggested lawmakers should wait to act on legislation until next year.

His union is opposed to the current version of the House bill, which gives the Postal Service wide leeway to close post office branches and make employee cuts to balance its budget.

More on This Story

More US & Canada stories

RSS

Features & Analysis

  • An ant and a humanAnts v humans

    Do all the world's ants really weigh as much as all the humans?


  • Tattooed person using tabletRogue ink

    People who lost their jobs because of their tattoos


  • Indian coupleSuspicious spouses

    Is your sweetheart playing away? Call Delhi's wedding detective


  • Civilians who had been hiding inside during gun battles manage to flee  from the Westgate Mall in Nairobi, Kenya Saturday, 21 September 2013Westgate's questions

    One year on, Kenyans await answers about the mall attack


Elsewhere on the BBC

  • GeoguessrWhere in the world...?

    Think you are a geography expert? Test your knowledge with BBC Travel’s interactive game

Programmes

  • StudentsClick Watch

    Could a new social network help tailor lessons to students’ needs and spot when they fall behind?

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.