Last Updated: Friday - 09/24/2010
Week of December 25, 2006
Canada Post restores postal subsidy
WCR no longer faces $80,000 postal cost increase
By GLEN ARGAN
Canada Post has restored its contribution to a federal government postal subsidy to Canadian newspapers and magazines for the next two years.
The restoration means that the WCR no longer faces an $80,000 increase in its costs for mailing the newspaper to its more than 35,000 subscribers.
Canada Post announced in September that it would eliminate the $15 million annual contribution it makes to the Publications Assistance Program (PAP) as of April 1, 2007. The cut would have eliminated one-quarter of the funding for the $60 million program and affected hundreds of publications that rely on the mail as their primary means of delivery.
However, Lawrence Cannon, minister responsible for Canada Post, announced Dec. 13 that the post office will continue to contribute to the program for another two years "while Canadian Heritage determines the best way to support the Canadian publishing industry in the years to come."
The PAP is a program of the Canadian Heritage department under minister Bev Oda.
Nevertheless, individual publications will likely see a smaller decrease in the amount of the postal subsidy.
The budget for the PAP is a fixed amount. As postal rates and the number of publications drawing on the fund increase, each publication will receive a slightly smaller piece of the pie next year.
The federal government had provided a direct subsidy to Canada Post since prior to Confederation to lower the cost of mailing newspapers and magazines.
However, about 10 years ago, the World Trade Organization ruled that was an unfair trade subsidy and should be discontinued.
The Canadian government responded by establishing the PAP which now earmarks specific subsidies for every publication which meets the program's criteria.