Australia Post Annual Report 2008–09

Statutory reporting requirements
for the year ended 30 June 2009
Introduction
Australia Post is subject to various
statutory reporting requirements under the
Australian Postal Corporation Act 1989, the
Commonwealth Authorities and Companies Act
1997, the Freedom of Information Act 1982,
the Occupational Health and Safety
(Commonwealth Employment) Act 1991,
the Superannuation Benefits (Supervisory
Mechanisms) Act 1990 and the Environment
Protection and Biodiversity Act 1999.
The index on pages 118–120 shows where
the relevant information can be found in this
annual report.
A number of matters are dealt with in the main
body of the report. Others are covered below.
Legislation
The powers and functions of Australia Post
are set out in Sections 14–19 of the Australian
Postal Corporation Act 1989 (Cwlth) (the Act).
Australia Post’s principal function is to supply
postal services within Australia and between
Australia and other countries. Australia Post
may also carry on any business or activity,
either domestically or internationally, that
relates or is incidental to the supply of
postal services.
Indemnities and insurance premiums
for directors and officers
Australia Post has in place a directors’ and
officers’ liability insurance policy. The policy,
which expires on 31 October 2009, provides
cover in respect of any person who is or was
a director or officer of Australia Post, when
acting in these capacities. Australia Post also
maintains a separate insurance policy, which
provides cover to all former directors or
officers of the corporation. This policy, which
expires on 31 October 2017, provides cover
in respect of any matters arising from the
time such persons were a director or officer
of Australia Post. Confidentiality requirements
within the insurance contracts prohibit any
additional disclosures.
Directors of Australia Post are also indemnified
by the corporation to the extent permitted by
law against any liability incurred in their
capacity as a director.
Corporate plan
Each year, Australia Post prepares a rolling
three-year corporate plan. The 2008–09 plan
and associated Statement of Corporate Intent
were submitted to the shareholder Ministers
in June 2008.
Objective
Our objective is to support profits through
further diversification of our business into
emerging areas of opportunity.
Strategies
The corporation has pursued three strategies
designed to maintain and grow revenue from
our existing operations in letters, agency
services & retail merchandise, and parcels
& logistics. The strategies and their main
programs of work are as follows.
1 Support and promote the letter value
chain and develop opportunities in the wider
communications market by:
• promoting and encouraging the use
of the mail channel
• maximising returns and ensuring all
aspects (price, design and processes)
of our current products remain
relevant to our customers
• developing opportunities in digital
communications.
2 Reposition our agency services and
retail merchandise business to provide
multi-channel service offers supported
by retail merchandise. This will be achieved
by becoming a service-based business
and by maximising EBIT and product
performance during a period of transition.
3 Maximise our return from our unique set
of distribution and logistics businesses
and extend our reach and capability to
meet market demand by:
• optimising returns from each of the
individual portfolio businesses
• driving synergies between the portfolio
businesses
• extending the capability and reach of the
portfolio through strategic partnerships
(including Sai Cheng and Kahala).
These three strategies were also influenced by
a number of company-wide strategic themes
relating to corporate social responsibility, our
online strategy and how the corporation
engages the youth market.
Targets
Key financial and non-financial performance
measures set out in the plan were:
• profit before tax of $575.1 million in the first
year of the plan
• dividends declared of $301.8 million in the
first year of the plan.
Specific targets for 2008–09 and performance
against these targets were:
Performance Indicator Target Performance
On-time letter delivery 94% 95.5%
Profit before tax
Return on average
$575.1m $380.9m
operating assets
Ordinary dividend
declared for
17.8% 12.2%
2008–09* $301.8m $184m
* A special dividend of $38.4 million was also declared.
Government Policies
In February 2004, the Minister of
Communications, Information Technology
and the Arts provided formal notification
under section 28 of the Commonwealth
Authorities and Companies Act 1997 that
the Government’s National Code for the
Construction Industry and associated
implementation guidelines were to apply
to all construction-related activity undertaken
by and on behalf of Australia Post. The
notification has had no major impact on the
corporation, as Australia Post had, since
the introduction in 1997 of the code and
guidelines, made compliance a condition
of all of its construction related tenders.
Section 49 of the Australian Postal Corporation
Act 1989 empowers the Minister to give the
board written directions in relation to the
performance of Australia Post’s functions as
appear to be necessary in the public interest.
No notification or direction has been issued
under this provision.
Other government obligations
Administrative law
The cost of meeting Commonwealth
administrative requirements in 2008–09
is estimated at approximately $1.5 million.
Postal industry ombudsman
During 2008–09, the PIO has estimated the
costs of investigating complaints relating
to Australia Post to be $265,000.
ACCC Record keeping
The cost of the regulatory audit and
compliance with the ACCC’s record keeping
rules in 2008–09 is estimated at $330,000.
Maintaining heritage properties
The cost of repairing and maintaining heritage
listed properties in 2008–09 was $1.45 million.
Australia Post Annual Report 2008–09 | Financial and statutory reports 121