Community service obligations for the year ended 30 June 2020

Australia Post’s community service obligations (CSOs) are set out in section 27 of the Australian Postal Corporation Act 1989, which requires that:

• Australia Post provide a letter service at a single uniform rate for standard letters carried by ordinary post within Australia;
• the letter service Australia Post is obliged to provide be reasonably accessible to all Australians on an equitable basis, in view of the social importance of the letter service;
• ensures that the performance standards (including delivery times) for the letter service reasonably meet the social, industrial and commercial needs of the Australian community

Prescribed Performance Standards
The Australian Postal Corporation (Performance Standards) Regulations 2019 prescribe standards required to be met in connection with Australia Post’s CSOs, commonly referred to as ‘Prescribed Performance Standards.’ Performance against the Prescribed Performance Standards is subject to independent audit by the Australian National Audit Office.

Australia Post met or exceeded all of the Prescribed Performance Standards in 2019/20, as summarised in the table below.

The On-time delivery, and Delivery timetable, results in this table take account of the temporary regulatory relief from 16 May 2020 (specifically, the suspension of the priority letters service and the changed delivery timetable for intrastate letters).

Organisational arrangements
Australia Post considers the strategies and policies it has in place to carry out its community service obligations are appropriate and adequate. The ongoing focus on Prescribed Performance Standards satisfaction is coordinated by the office of the Corporate Secretary.

CSO Costs
There is a financial cost associated with meeting CSOs. Australia Post is required to provide certain domestic and international products to customers at a uniform price but costs can vary considerably, primarily as a result of the higher operational unit costs to service more remote destinations.
The cost of providing the CSO for 2019/20 is estimated at $393.3 million (2018/19: $392.2 million), including $201.6 million in rural and remote locations (2018/19: $187.4 million).