Costly Letters

Nov 17, 2006 (LBO) – Delayed tariff revisions, fuel price hikes and wage bills have driven up losses at Sri Lanka™s Postal Department, to over a billion rupees in the first six months this year.

According to provisional data by the Central Bank, operating losses as at June this year was up 13 percent to 1.017 billion rupees, over the same period last year.

Our expenditure has gone over our revenue. The main reasons for that (increased operating loss) are salaries going up, basic charges for postal services have increases, fuel price hikes and more, Postmaster General Sherwin Senadeera told LBO.

The postal department™s tariff structure has not been revised since 2004, with five rupees still charged to deliver a letter, when the actual cost to the department is about double that.

Free of charge services or ˜social obligatory services™ such as delivering letters also drives up costs, Senadeera says.

A postman can carry about 200 letters per round but if there is only about 15 to 20 letters for that round he still has to deliver them. That will bring in less revenue at a higher expense, but we cannot charge for a social obligatory service.

Post office