The ACCC is calling for submissions on Australia Post’s draft proposal to increase the price of its basic postage rate from January 2023.
Australia Post proposes to raise the basic postage rate from $1.10 to $1.20, which is also the price to deliver reserved ordinary small letters. Australia Post has also proposed an increase to the prices for reserved ordinary large letters, from $2.20 to $2.40 for letters up to 125 grams and from $3.30 to $3.60 for letters between 125 grams and 250 grams.
The ACCC’s consultation paper, published today, will provide an overview of key issues and details of how interested parties can make a submission.
“We welcome submissions from industry stakeholders and consumers, and they will all be taken into account before we release our view on the draft proposal,” ACCC Commissioner Anna Brakey said.
Following the consultation process, the ACCC will release a preliminary view on the draft price notification before a formal notification is lodged by Australia Post. The ACCC must then make a final decision about whether or not to reject the proposal within 21 days.
The last price notification from Australia Post considered by the ACCC was in 2019.
The ACCC does not have the role of approving the proposed price increase under the Australia Post price notification framework. But it assesses the proposed price increase in accordance with the Competition and Consumer Act and determines if there are objections to the proposed price increase on competition grounds.
Australia Post must also give written notice to the Minister for Communications of its intent to vary its rates of postage and may only increase the basic postage rate if the Minister does not disapprove the proposed increase to the basic postage rate within 30 days.
Further information is available at Australia Post – letter pricing 2022.
Background
Reserved ordinary letter services are comprised of small letters that are delivered at the basic postage rate, large letters up to 125 grams and large letters between 125 and 250 grams.
When a formal price notification is lodged, the ACCC must make an assessment within 21 days of lodgement. Australia Post must not increase prices within this period. Under section 95Z(6) of the CCA, the ACCC can give the person a notice in writing stating that it would have no objection to the proposed increase; or give notice stating that it would have no objection to a lower price increase. If the ACCC does not give such a notice, the declared firm commits an offence if it supplies the notified service at the higher price.
Given that 21 days is too short for an effective consultation and assessment process, the ACCC has typically agreed with Australia Post that it provide a draft version of the price notification to obtain the ACCC’s view before formal lodgement.
