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Postal Service to Reduce Debt by $200 Million

Press release from the issuing company

Postmaster General credits holding the line on costs for fiscal improvement WASHINGTON, D.C. - The Postal Service will reduce its debt by $200 million this fiscal year Postmaster General John Potter told the Senate Governmental Affairs subcommittee today. The fiscal turnaround was remarkable because, as Potter noted, "Last year we were talking about increasing our debt by $1.6 billion." Potter told the committee that the improved financial outlook meant that there would not be a general rate increase until well into 2004. "In a year marked by challenges and measured by innovation, we took dramatic steps to reduce expenditures," Potter said. "For the first time in postal history, we were able to reduce our current year expenses below the expenses of the previous year." Expenses were reduced by $2.9 billion this fiscal year by reducing employee complement by 23,000 through attrition. "Our total complement today is similar to what it was in 1995," Potter reported. "Since 1995 mail volume has risen 21 billion pieces and our delivery network has added 12 million new addresses." Potter attributed the improvement in finances to the efforts of employees and managers to hold the line on costs. "Their efforts enabled the Postal Service to reduce our projected negative net income to significantly less than $1 billion," he said. Net loss projections earlier in the year ranged as high as $4.5 billion. Potter noted that service performance has improved since last fall. "We reached record levels of performance for overnight, 2-day and 3-day First-Class Mail and Priority Mail," Potter observed. "Express Mail scores are the highest they've been in four years." "We will continue our strong focus on improving service performance and holding the line on costs," Potter pledged to the committee.