Australia Post's letter price hike won't be opposed by consumer watchdog

Reserved ordinary letters will see changes from April, with the price of small letters to rise from $1.20 to $1.50, large letters up to 125 grams from $2.40 to $3 and large letters between 125 and 250 grams from $3.60 to $4.50.

The average resident, who sends roughly 15 small letters a year, is set to pay $4.50 more under the price hike. 

There will not be any price increases for concession stamps or seasonal greeting cards.

The Australian Competition and Consumer Commission (ACCC) today announced it would not oppose the cost-recovery rise as it was not within its role to do so.

Only Communications Minister Michelle Rowland has the power to reject the proposal.

The commission did, however, identify some concerns and made recommendations to improve Australia Post's financial modelling.

"Our recommendations seek to improve how Australia Post incurs and accounts for the costs of its reserved letter services, so consumers are not paying more for stamps than they should," Commissioner Anna Brakey said.

"We acknowledge the concerns raised in our consultation processes about the impact of the price increase on consumers and businesses, especially in light of cost-of-living pressures."

Its letter services saw one of the most declining year-on-year trends and experienced a loss of $384.1 million.

This was due to a combination of nosediving volumes in the digital age and increasing delivery addresses.