The government is worried about the great losses accumulating at Canada’s postal service (Canada Post). A government official said that the government wants to see the proposed plans for controlling losses.

On Tuesday, Canada Post reported a loss of $104 million for the second quarter of 2013. At this rate, Canada Post will run out of cash within a year. The woes facing Canada Post are due to migrations of customers to digital communication technologies. Canadian mail volume has fallen 6.3% compared to the second quarter of 2012.

There are other challenges facing Canada Post such as the deficit in its pension plan. The deficit is approximately C$5.9 billion. In normal circumstances, Canada Post is expected to operate as a self-financing organization.

There are many strategies that Canada Post plans to follow in order to get out of the losses. These include: raising prices, reducing labor costs, re-structuring the current business model, cutting back on deliveries and freezing wages for a year. In 2014, Canada post plans to make special payments to the tune of C$1.1 billion to help reduce the shortfall in its pension plan. Canadian Union of Postal Workers is seeking an open dialogue about the situation.

Related article: http://ca.reuters.com/article/domesticNews/idCABRE97R15620130828