The federal government is providing Canada Post with repayable funding of just over $1 billion for the 2025/26 fiscal year.

The short-term financing, which is within the regulations of the Canada Post Corporation Act, is intended to help the corporation maintain its solvency and continue operations as it deals with some serious financial challenges.

Canada Post says the federal funding will not solve its structural problems but will serve as bridge funding as the corporation works with the government on a plan to ensure its long-term viability.

The corporation says it has recorded “significant annual losses since 2018,” driven primarily by rapid changes in postal and parcel delivery, high labour costs and regulatory measures that it says impede Canada Post’s ability to “evolve and compete.”

Canada Post was recently embroiled in a labour dispute with its carriers. The CUP-W members were mandated back to work just days before Christmas when the Canada Industrial Relations Board determined that the two sides were too far apart to realistically reach an agreement by the end of December.