WASHINGTON, USA — The US Postal Service lost US$2 billion this spring despite increasing its volume and charging consumers more money to send mail, officials said on Monday last.

The loss for the spring quarter, which ended June 30, was significantly higher than the US$740 million loss for the same three-month period last year. The agency blamed increases in compensation and benefit costs for the red ink and said it would be unable to make a congressionally mandated payment of US$5.7 billion this September for health benefits for future retirees. The loss came despite a two per cent increase in operating revenue compared to last spring.

“Due to continued losses and low levels of liquidity, we’ve been extremely conservative with our capital, spending only what is deemed essential to maintain existing infrastructure,” said Joseph Corbett, the Postal Service’s chief financial officer.

The Postal Service is an independent agency that receives no tax dollars for its day-to-day operations but is subject to congressional control. It has asked to end most Saturday deliveries, a request that is languishing in Congress amid opposition by postal unions. The agency also is seeking to eliminate the congressionally mandated US$5.7 billion annual payment for future retiree health benefits.

Fredric Rolando, president of the National Association of Letter Carriers, agrees that Congress should get rid of the 2006 mandated payment but says it would be “irresponsible to degrade services to Americans and their businesses” just as postal delivery is rebounding with the economy. Because more people are shopping online, “the Internet is now a net positive for USPS, auguring well for the future as e-commerce grows,” Rolando said in a statement.

The Postal Service has defaulted before on federally mandated annual payments to cover expected health care costs for future retirees. Corbett said the agency also needs $10 billion to replace old vehicles, buy new package sorting equipment and make other infrastructure upgrades.

Other findings from the latest quarterly report compared to the same time period last year:

—Shipping and package revenue was up 6.6 per cent, while standard mail revenue increased 5.1 pe rcent. The increase was attributed both to higher volume and prices charged to consumers.

—First-Class mail volume declined by 1.4 per cent, but revenue climbed 3.2 per cent because of price increases.

—Operating revenue increased by US$327 million to $16.5 billion.

—Operating expenses increased by $US1.5 billion to $18.4 billion.