Licensed post office owners are leaving their businesses with nothing to show for decades of work, the head of their primary national association has told a Senate inquiry.
Ian Kerr, chief executive of the Post Office Agents’ Association, said about 25 post offices had closed in each of the past two years. While that represents less than 1 percent of the network, he said, “it’s still 25 communities that now have reduced postal services.”
Australia Post currently relies on approximately 2,900 licensed post offices (LPOs), which make up about two-thirds of its total retail outlets.
Kerr said many LPOs are listed for sale for a long time without receiving a single offer.
“At the moment, they’re not getting a dignified exit from the business; they’re walking away with nothing, and that is not acceptable,” he said.
He suggested that licensed post offices may need “some sort of keeping-the-network-alive payment,” though he could not specify how it would be structured.
“The price of inaction or wishful thinking will be the gradual decay of the network to the detriment of … rural and remote Australia,” he said.
Asked about an Australia Post trial offering licensees a payout to close, Kerr said his understanding was that it would be voluntary.
His view, he said, “depends on what the payment is.”
The financial pressure on the network comes as Australia Post’s business continues to shift from letters to parcels. Letter volumes have fallen sharply over the past decade, while parcel deliveries have grown with online shopping.
Australia Post reported an $18.8 million pre-tax profit in the 2025 financial year, following an $88.5 million loss the previous year. Parcels and Services revenue reached $7.64 billion.
The postal service said it remained committed to maintaining 4,000 post offices, including 2,500 in regional, rural and remote areas.
Rival Carriers Offer Another Revenue Stream
Rival parcel carriers told the same inquiry they could provide additional income for licensed post offices if Australia Post allowed them to do so.
Peter Munro, director of the Australian Parcels Industry Forum (APIF), which represents rival parcel carriers including FedEx and Team Global Express, said licensees are barred by contract from handling parcels for other carriers without Australia Post’s permission.
He said members had sought consent for more than three years and had been refused.
“Carriers pay; taxpayers do not,” Munro said.
He said APIF members account for about 20 percent of the nation’s parcel deliveries.
The forum commissioned Lateral Economics to model the proposal. Jon Bell, a member of the forum’s executive committee, estimated opening licensed post offices to rival carriers would generate $1.5 billion in net economic benefits over 10 years, with $177 million of that benefit going to post offices.
“We estimate Australia Post has 95 percent market share in regional areas,“ he said, “so we’re talking about a very substantial amount of volume.”
Bell said Australia Post was concerned that the proposal was a “zero-sum game in a non-growing market” but APIF disagreed because people in regional areas were buying more online than those in the cities.
“So Australia Post may not grow at a level that would maintain 95 percent market share, and we would argue nor should it,” he said.
“Regional Australians should benefit from competition, while also allowing Australia Post to grow, perhaps [with] not as much [of] a monopoly as it might have otherwise.”
Tom Harden of the Conference of Asia Pacific Express Carriers (CAPEC) said that members would pay licensees to hold parcels that could not be delivered on the first try.
He called it “recurring volume-based income at no cost to taxpayers or to Australia Post.”
CAPEC represents DHL Express, FedEx, and UPS.
Post Office Group Questions Proposal
Kerr told senators his association had “not been approached by any group” about the proposal and had not been given modelling on how it would work or what licensees would be paid.
Senator Sarah Henderson asked whether he supported the plan, regardless of whether he had seen its details.
Kerr initially responded: “I’ve not seen a proposal.”
Pressed further by Henderson, he acknowledged he had seen the APIF proposal and its modelling, but said he had “many questions” about the assumptions behind it.
“I’m not going to rule anything out without having perused a proposal,” he said. “I’m certainly not going to throw [the association’s] support behind anything without seeing some details.”
Bell said carriers do not approach licensees directly because they had been “warned against doing that.”
He said APIF speaks regularly with the LPO Group, a separate licensee body.
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