SENDING a letter could cost more than $1 following the federal government's approval of a two tier letter service.
Australia Post can now introduce a new regular letters service, which will see mail delivered two days slower than the current timetable, while those wanting to send mail to the existing schedule will pay more for a priority service.
Australia Post managing director and Group chief executive Ahmed Fahour said the company would seek approval from the Australian Competition and Consumer Commission to raise the basic stamp price from 70 cents to $1 to better reflect the total cost of sending a letter.
This new price would apply to the regular service.
The concession stamp price will be frozen at 60 cents, Christmas stamps will be frozen at 65 cents.
The new measures would see mail continue to be delivered five days a week.
Australia Post said the changes would help keep post offices open - including the regional and rural network.
However, the Post Office Agents Association Limited (POAAL) said owners of Licensed Post Offices (LPO) were being left in the dark as to what the changes might mean for their businesses.
POAAL director Bob Chizzoniti said Australia Post had yet to give POAAL full details on what impact the proposed price rise would have on stamp sales, mail volumes and workloads at LPOs.
"We have requested detailed information on how an increase in the stamp price from 70 cents to $1 would affect mail volumes," he said.
"While a stamp price increase will boost some LPO payments, POAAL is sensitive to how pricing changes might affect stamp sales at LPOs."
He said moving to a two-speed service and increasing the price was just treading water.
"A real plan for the future is needed, that takes into account the future needs of the post office and its customers in the 21st Century."
Mr Chizzoniti said POAAL members wanted to see a healthy, profitable Australia Post which would reflect well on the value of its members' businesses.
"POAAL's mail contractor members - particularly those that only deliver letters - are watching these developments very closely.
"Any reform that accelerates the decline in mail volume would have a deleterious effect on their incomes.
"Mail Contractors are a vital part of Australia Post's delivery network and part of the fabric of regional and remote communities."
Mr Fahour said that, in order to have a sustainable letters service, the senders of mail needed to bear their fair share of the cost.
Australia Post was not seeking, or expecting, to make profits from the reserved letters service.
"Australia currently has the lowest basic stamp price in the developed world. Unfortunately we must raise that price to ensure we can maintain the service, including five-day-a-week delivery and across 4000 post offices," Mr Fahour said.
"Up to 97 per cent of mail is sent by business and government.
"Taxpayers, through Australia Post, can no longer afford to keep subsidising corporate Australia by running a below-cost letters service predominantly for this sector."
Mr Fahour said the service changes would not be introduced until September this year at the earliest.
In the meanwhile, he said, Australia Post would work closely with community, staff and customers ahead of their introduction, this included a national program of community consultation regarding the implementation of the changes.