PAP rate set for release week of Feb. 11

Officials at the federal Department of Canadian Heritage are set to release the new rates for the Publications Assistance Program (PAP) as early as Feb. 11.

According to sources, negotiations with Canada Post Corporation extended well past the anticipated deadlines as a result of extensive industry and political lobbying. Canada Post had originally proposed a package of increases to its Publications Mail service that many in the industry found exhorbitant. A new set of proposed rates were put forward and subsequently approved by the Canada Post board.

The new Publications Mail rates would see the cost of mailing a 75g publication increase by as much as 5.6 percent beginning April 15. The cost of mailing a 150g publication will increase by as much as 6.3 percent. Most community newspapers use Publications Mail as part of the PAP and thus pay a subsidized rate, currently at 9.5 cents for the first 200g. The new PAP reference tariff, or subsidized rate, is calculated based on the actual cost of Publications Mail in addition to negotiated amounts for volume rebates and other contributions from Canada Post.

The size of the increases contemplated by Canada Post became crucial this year as the Publications Assistance Program approached its funding cap of $46.4 million annually. Once the value of the program exceeds that amount, the difference is added to the portion paid by the publication. As a result, the final reference tariff is affected as much by anticipated volumes as by postal increases.

Some 400 community newspapers participate in PAP, accounting for just $4 million of the total $46.4 million subsidy account. Magazines and periodicals make up the bulk of the participants. Officials at Heritage are in the midst of a full review of the program that could see eligibility criteria and subsidy levels change in future. CCNA is participating in those consultations. The discussion paper and the full CCNA response can be downloaded from CCNA's web site in PDF format at http://www.communitynews.ca/pap .