Copyright 1999 Federal Document Clearing House, Inc.
Federal Document Clearing House Congressional Testimony
October 21, 1999
SECTION: CAPITOL HILL HEARING TESTIMONY
LENGTH: 3614 words
HEADLINE:
TESTIMONY October 21, 1999 WILLIAM J. HENDERSON POSTMASTER GENERAL AND CHIEF
EXECUTIVE OFFICER UNITED STATES POSTAL SERVICE
HOUSE GOVERNMENT REFORM CIVIL SERVICE
OPERATIONS OF POSTAL SERVICE
BODY:
Statement of William J. Henderson Postmaster General and Chief Executive
Officer United States Postal Service before the Subcommittee on
the Postal Service, Committee on Government
Reform, U.S. House of Representatives October 21, 1999 Mr.
Chairman and members of the Subcommittee, I appreciate the dedication and
insight you bring to oversight of the United States Postal Service. I want to
thank you for helping us fulfill our mission to bind our nation together by
delivering to everyone, everywhere, every day. Today, I am going to discuss a
year, a season, and a century of postal service. With the help of the American
public, postal employees made Fiscal Year 1999 one for the record books. Based
on preliminary figures, the Postal Service earned record revenues of just over
$62 billion, broke the 200 billion mark in total mail volume, achieved its best
overall performance ever in First- Class Mail delivery, and recorded an
unprecedented fifth straight year of positive net income. The American people
are the direct beneficiaries of this performance. First, it fulfills our promise
to them to continue to restore the equity of the nation's mail system in
accordance with the provisions of the Postal Reorganization Act. Second, it
reflects our decision last year to delay the smallest rate increase in postal
history by seven months, in effect providing the American public with an $800
million dividend. Finally, it keeps us on track to avoid a rate increase next
year as we had originally planned. All told, these efforts will save America's
ratepayers more than $2 billion. We also made substantial investments in the
mail as the Postal Service shifts from the age of automation to the age of
information. While we continue to advance the automation of letter mail and
fiats, robots and sophisticated handling systems are being introduced into our
plants. Within the next several years, fully automated processing facilities and
a computer driven information platform will revolutionize the way we manage the
mail and create an information rich mail stream that will give postal managers
and customers alike real-time performance information. Information management is
also driving change in the management and delivery of retail services. Our
associate office infrastructure program is hard- wiring thousands of postal
facilities into a national network that provides the communications backbone for
new information technologies. This enabled us to deploy this year more than
22,000 of our next generation POS ONE retail terminals and over 300,000 hand
scanners for delivery confirmation. More than 25 million documents and packages
have been delivered and confirmed using this service. Even the most advanced
technology is only as good as the people who use it. The Postal Service has made
it a top priority to build an inclusive and welcoming workplace that fosters
employee success. We are committed to improved workplace safety, better
workplace relations, systematic training for all craft and EAS employees,
quarterly surveys to understand and measure employee concerns and issues, and
the development of indicators and performance baselines to guide our progress in
developing a fair and inclusive environment. This year, for the first time in a
decade, we reached negotiated contract agreements with two of our major unions.
A third contract was settled at arbitration. We are disappointed that the
arbitration decision failed to maintain parity with the negotiated agreements.
Nevertheless, we are working cooperatively with our union and management
associations. And we have made significant progress in developing faster, more
effective means for resolving workplace differences. I think all parties realize
that we must work better together if we are going to remain a viable enterprise.
Diversity is an imperative business issue for the Postal Service, which has one
of the nation's most diverse work forces and a unique mandate to bind together a
nation that grows more diverse every day. This year we completed adoption of 23
diversity initiatives recommended in an independent study commissioned by the
Governors of the Postal Service. Our five-year Diversity Business Plan builds on
this progress through comprehensive communications; appropriate recruitment,
retention and promotion practices; an environment free of discrimination and
sexual harassment; and establishment of a diverse supplier base. Finally, each
of you has received the Postal Service's Annual Performance Plan for Fiscal Year
2000, which embodies the results of our Customer Perfect!, Baldrige-based
management system. This plan will help us deliver today and prepare us to become
a high- performing, operationally excellent supplier of choice for 21st century
postal services in a competitive environment. As spelled out in the plan, it is
our aim to further restore the equity of the Postal Service through a sixth
consecutive year of positive net income and a capital investment of $4 billion
in technology, facilities, and other infrastructure. We will also continue on
our path of cultural regeneration to make the Postal Service a great place to
work as well as the preferred place to do business. We plan further service
improvements in First-Class and Priority Mail, advertising, ground parcels,
periodicals, and international mail. And we are committed to staying America's
high value, low cost service provider by keeping future rate increases below the
cumulative rate of inflation. We are already more than a month into the new
fiscal year and squarely in the middle of our busiest mailing season. We have
been preparing for this season almost non-stop since last year. Working closely
with the mailing industry, we have arranged for temporary airlift and work space
capacity, 40,000 seasonal workers, and millions of dollars in mail trays,
containers and other needed supplies. Our network operations communications
network is ready and will run 24-hours a day during the height of the season. We
are off to a strong start and confident that we will deliver. This year the
holiday season also brings with it a Y2K Grinch. But we have invested
significant resources and talent to be ready for him, too. All of our mission
critical information and mail processing systems have been addressed, tested,
and independently verified. Live year-end mail processing simulations have been
successful and our entire system has cleared the preliminary hurdles represented
by the start of Fiscal Year 2000 and the date of September 9, or 9/9/99, which
some thought might crash older systems. We have also created more than 500 local
contingency plans based on our considerable experience dealing with natural
disasters that disrupt utilities, transportation, and other vital services. We
will continue to prepare as the new year approaches and we will be ready to
respond when it arrives. The Postal Service is heading into the next century
with the best performance, planning, technology, and management systems in our
history. As always, we owe that success to the extraordinary effort of our
managers, postmasters, supervisors, and craft employees. At the same time,
though, we enter the new millennium knowing full well that the most significant
challenges in our history await us. Tomorrow's marketplace will offer Americans
more powerful and plentiful communications choices than ever before. Private
delivery carriers will aggressively try to maintain domination in their
respective markets. Newly privatized and deregulated foreign posts can be
expected to offer an increasing range of international services to American
customers and to begin creating delivery networks right here on U.S. soil. We
also face exponential growth in electronic communications. Computing power,
bandwidth, innovation, and popular acceptance are rapidly expanding. And
well-funded and highly motivated forces in the banking, telecommunications, and
computer industries are building e-payment networks. As consumers grow more
comfortable with logging on to pay their bills - these efforts will reach
critical mass. The result could be erosion of our total revenues. We believe
nearly $17 billion is at risk. Our market research suggests that First-Class
Mail volumes may actually decline over the next five years, even though we
increase mail's value by keeping costs low and quality high. This factor, along
with the rising costs of maintaining a national infrastructure of 38,000
facilities and a delivery network that grows by a million stops a year, means we
cannot sit still. We have to generate new growth if we are to maintain
affordable prices and investments in better service. That is why we have been
vocal in calling for postal reform, and why we have worked
closely with this subcommittee to develop a fair, meaningful
reform bill. The legislation includes some tradeoffs, but on
balance, we believe it provides pricing and product flexibilities we need to
stay relevant and healthy. We have a responsibility to the American people to
ensure a healthy and meaningful postal system in the next century. What's at
stake is not just the continuation of perhaps the most visible and personal of
all federal services, but the endurance of a delivery system that touches every
American, helps bridge our vast distances and differences, and binds our nation
together. The mail is an experience that we all share. We look forward to
getting our mail. It is a unique and powerful -moment in our day. It brings
information, entertainment, opportunity, and basic necessities. There are
magazines and catalogs; birthday presents and post cards; bills, coupons, and
offers galore. Mail has become the gateway to the household, an unmatched
channel for commerce and communication that connects families and friends,
governments and citizens, businesses and customers, publishers and readers,
charities and sponsors. As we look to the next century and the turbulent change
it will bring, we have to ask ourselves, "What will it take to preserve that
connection for the next generation of Americans?" I believe an answer does exist
and I think we can take our cue from the way this nation and its mail system
managed the transition to the current century. As the year 1900 approached, our
postal system, the Congress, and the American people were grappling with a
nation in transformation. America was becoming a world power and the postal
system was expanding its reach around the globe to possessions and territories
like Alaska, Hawaii, Puerto Rico and Guam and American troops serving in Cuba
and the Philippines. At home, the industrial revolution was in full swing. And
the Postal Service, ever pushing the envelope of technology, was testing mail
collections by automobile in Buffalo, New York. Postmaster General Charles Emory
Smith ventured out on a limb to predict that "the substitution of motors for the
horse and wagon will Possibly become universal." The real revolution, however,
was taking place in rural America where our farmers demanded access to the
information superhighway of rural free mail delivery. Many knowledgeable
observers and some members of Congress feared that a universal mail system would
drain the national treasury. But the voice of rural America prevailed. In the
end, rural delivery not only worked for America's farmers, it stimulated the
entire nation. It increased the circulation of the press and periodicals, raised
farm values, prompted the creation of roads, and expanded commerce. The mail-
order industry blossomed as did private parcel firms. Today, America and the
Postal Service face a new century of opportunity and uncertainty. In many ways,
the issues are far less controversial than a century ago, but the stakes are
just as high -- America's place in the 21st century and universal mail service
for all Americans. The Postal Service's strategies are just beginning to take
shape, and our role vis-a-vis the private sector will have to be defined in
concert with all of you and our many stakeholders and customers. But some things
are already very clear. We must build on our strong Internet presence. Our
public homepage is the most heavily trafficked government site, receiving about
three million "hits" each month. Customers use this site to find ZIP Codes,
calculate rates, buy stamps, track packages, and get other key postal
information. We intend to use the speed and access of the Internet to offer
customers information about their mail and access to our products and services.
As on-line purchases soar, both businesses and consumers want prompt, reliable
delivery, and easy access to a carrier who can handle returns. The Postal
Service is listening to the voice of America and we are working to earn our
share of the growth. We believe we can be the carrier of choice for merchandise
purchased on the Internet and the inevitable returns that result. So, despite
many challenges, the Postal Service sees the 21st century as another great
opportunity to build on our legacy of service to our nation. We have worked hard
to combine private- sector efficiency and customer focus with our public service
responsibilities as good government. We look forward to working with this
subcommittee to assure that the American people can continue to rely on the
Postal Service for high-quality, low-cost mail services. Thank you, Mr.
Chairman, that concludes my statement.
LOAD-DATE:
October 25, 1999 
