From the Fraser Institute

By Jake Fuss and Alex Whalen

In the latest chapter of a seemingly never-ending saga, Canada Post workers are on strike again for the second time in less than a year, after the federal government allowed the Crown corporation to close some rural offices and end door-to-door deliveries. These postal strikes are highly disruptive given Canada Post’s near monopoly on letter mail across the country. It’s well past time to privatize the organization.

From 2018 to the mid-point of 2025, Canada Post has lost more than $5.0 billion, and it ran a shortfall of $407 million in the latest quarter alone. Earlier this year, the federal government loaned Canada Post $1.034 billion—a substantial sum of taxpayer money—to help keep the organization afloat.

As a Crown corporation, Canada Post operates at the behest of the federal government and faces little competition in the postal market. Canadians have nowhere to turn if they’re unhappy with service quality, prices or delivery times, particularly when it comes to “snail mail.”

Consequently, given its near-monopoly over the postal market, Canada Post has few incentives to keep costs down or become profitable because the government (i.e. taxpayers) is there to bail it out. The lack of competition also means Canada Post lacks incentives to innovate and improve service quality for customers, and the near-monopoly prohibits other potential service providers from entering the letter-delivery market including in remote areas. It’s clearly a failing business that’s unresponsive to customer needs, lacks creativity and continuously fails to generate profit.

But there’s good news. Companies such as Amazon, UPS, FedEx and others deliver more than two-thirds of parcels in the country. They compete for individuals and businesses on price, service quality and delivery time. There’s simply no justification for allowing Canada Post to monopolize any segment of the market. The government should privatize Canada Post and end its near-monopoly status on letter mail.

What would happen if Ottawa privatized Canada Post?

Well, peer countries including the Netherlands, Austria and Germany privatized their postal services two decades ago. Prices for consumers (adjusted for inflation) fell by 11 per cent in Austria, 15 per cent in the Netherlands and 17 per cent in Germany.

Denmark has taken it a step further and plans to end letter deliveries altogether. The country has seen a steep 90 per cent drop in letter volumes since 2000 due to the rise of global e-commerce and online shopping. In other words, the Danes are adapting to the times rather than continuing to operate an archaic business model.

In light of the latest attempt by the Canadian Union of Postal Workers to shakedown Canadian taxpayers, it’s become crystal clear that Canada Post should leave the stone age and step into the twenty-first century. A privately owned and operated Canada Post could follow in the footsteps of its European counterparts. But the status quo will only lead to further financial ruin, and Canadians will be stuck with the bill.

Jake Fuss

Director, Fiscal Studies, Fraser Institute

Alex Whalen

Director, Atlantic Canada Prosperity, Fraser Institute

From the Frontier Centre for Public Policy

By Michael Zwaagstra

The real challenge is managing classrooms with wide-ranging student needs, from special education to language barriers

Teachers’ unions have long pushed for smaller class sizes, but the real challenge in schools isn’t how many students are in the room—it’s how complex those classrooms have become. A class with a high proportion of special needs students, a wide range of academic levels or several students learning English as a second language can be far more difficult to teach than a larger class where students are functioning at a similar level.

Earlier this year, for example, the Elementary Teachers’ Federation of Ontario announced that smaller class sizes would be its top bargaining priority in this fall’s negotiations.

It’s not hard to see why unions want smaller classes. Teaching fewer students is generally easier than teaching more students, which reduces the workload of teachers. In addition, smaller classes require hiring more teachers, and this amounts to a significant financial gain for teachers’ unions. Each teacher pays union dues as part of membership.

However, there are good reasons to question the emphasis on class size. To begin with, reducing class size is prohibitively expensive. Teacher salaries make up the largest percentage of education spending, and hiring more teachers will significantly increase the amount of money spent on salaries.

Now, this money could be well spent if it led to a dramatic increase in student learning. But it likely wouldn’t. That’s because while research shows that smaller class sizes have a moderately beneficial impact on the academic performance of early years students, there is little evidence of a similar benefit for older students. Plus, to get a significant academic benefit, class sizes need to be reduced to 17 students or fewer, and this is simply not financially feasible.

In addition, reducing class sizes means spending more money on teacher compensation (including salaries, pensions and benefits). Also, it leads to a decline in average teacher experience and qualifications, particularly during teacher shortages.

As a case in point, when the state of California implemented a K-3 class-size reduction program in 1996, inexperienced or uncertified teachers were hired to fill many of the new teaching positions. In the end, California spent a large amount of money for little measurable improvement in academic performance. Ontario, or any other province, would risk repeating California’s costly experience.

Besides, anyone with a reasonable amount of teaching experience knows that classroom complexity is a much more important issue than class size. Smaller classes with a high percentage of special needs students are considerably more difficult to teach than larger classes where students all function at a similar academic level.

The good news is that some teachers’ unions have shifted their focus from class size to classroom complexity. For example, during the recent labour dispute between the Saskatchewan Teachers’ Federation (STF) and the Saskatchewan government, the STF demanded that a classroom complexity article be included in the provincial collective agreement. After the dispute went to binding arbitration, the arbitrator agreed with the STF’s request.

Consequently, Saskatchewan’s new collective agreement states, among other things, that schools with 150 or more students will receive an additional full-time teacher who can provide extra support to students with complex needs. This means that an extra 500 teachers will be hired across Saskatchewan.

While this is obviously a significant expenditure, it is considerably more affordable than arbitrarily reducing class sizes across the province. By making classroom complexity its primary focus, the STF has taken an important first step because the issue of classroom complexity isn’t going away.

Obviously, Saskatchewan’s new collective agreement is far from a panacea, because there is no guarantee that principals will make the most efficient use of these additional teachers.

Nevertheless, there are potential benefits that could come from this new collective agreement. By getting classroom complexity into the collective agreement, the STF has ensured that this issue will be on the table for the next round of bargaining. This could lead to policy changes that go beyond hiring a few additional teachers.

Specifically, it might be time to re-examine the wholesale adoption of placing most students, including those with special needs, in regular classrooms, since this policy is largely driving the increase in diverse student needs. While every child has the right to an education, there’s no need for this education to look the same for everyone. Although most students benefit from being part of regular academic classes, some students would learn better in a different setting that considers their individual needs.

Teachers across Canada should be grateful that the STF has taken a step in the right direction by moving beyond the simplistic demand for smaller class sizes by focusing instead on the more important issue of diverse student needs.

Michael Zwaagstra is a senior fellow with the Frontier Centre for Public Policy.