I would like to start by acknowledging the traditional custodians of the Canberra area, the Ngunawal and Ngamberi peoples, and pay my respects to their elders past and present.
I thank the Committee for the opportunity to provide this brief opening statement, and my colleagues and I look forward to responding to the Committee's questions.
Australia Post's retail outlets are the beating heart of Australian communities. We never underestimate the significant role we play in providing essential connection and services.
We remain steadfast in our commitment to maintaining a minimum network of 4,000 retail outlets nationally.
Today, we have 4,100 retail outlets. Of these, Licensed Post Offices are the single largest cohort representing approximately 65% of the network. While some are operated as standalone outlets, many are run in conjunction with another business owned by the Licensee that might help enhance its financial sustainability or fill an important retail or service gap in a community.
To offer some perspective, there are more Australia post retail outlets in Australia than all bank branches combined or all supermarkets combined.
Over the past four years, we have invested almost $400 million in our retail network, including a new point of sale system, outlet upgrades, new cash and counter technology to better support our team and customers.
We also continue to invest heavily in brand and marketing to promote the services that our retail outlets provide.
A network of our size, composition and scale brings its own set of challenges. One of the most pressing is the sustainability of Licensed Post Offices, both now, and especially in the years to come.
The stark reality is that with each passing year, fewer Australians are using Australia Post's over-the-counter services.
Our traditional, core business of letters continues its rapid decline. Volumes are now at levels last seen in the 1930s. This volume decline will only accelerate as digital alternatives continue to replace traditional mail.
Australians have made a dramatic shift towards online banking, and we are now regarded as one of the world's most concentrated digital banking markets. However, there is still a need for access to physical banking, particularly in vulnerable communities and regional areas. This is where Bank@Post is most relied upon and why it was so important to renegotiate our Bank@ Post agreements to make them commercially viable for Australia Post and our licensees.
Across our geographic footprint we have an over-concentration of outlets in metropolitan areas, while regional outlets are experiencing fewer visits and declining transaction volumes. Both sets of circumstances have a significant impact on an outlet's long-term viability.
While we all agree Australia Post's services are indispensable, these challenges have placed pressure on Licensee incomes and have had a compounding impact on the financial sustainability of both Australia Post and our Licensees.
It is because of these market forces and the changing nature of consumers that we have been working closely and engaging with our Licensee partners on updating Licensee agreements and frameworks that have remained largely unchanged for many decades.
We are in active consultation to give Licensees more options of choosing a more sustainable remuneration model and a greater reward for their efforts
Not all stakeholders will agree with every aspect of our proposal, but we fully respect their views and will always carefully consider them.
Our collective goal must be the sustainability of the network and, the continuation of important community services. Our collective response needs openness and a realisation that the world has and will continue to change and that Australia Post and its important licensee network must change also.
I acknowledge the themes of many of the submissions to this Inquiry, and I agree with the sentiments expressed. The Australia Post network and our licensees are essential, especially in regional and rural and remote Australia.
We welcome this opportunity to discuss the Post Office network, and our efforts to support Licensees and make them more sustainable.
In closing, I want to acknowledge the licensees, their families and the Australia Post team members who deliver for their communities every day. I also want to thank the Committee for this opportunity.
