For the first time since the end of World War II, the nation's postal system operated without a loss for an entire fiscal year.
In fact, Postmaster General William Bolger announced yesterday, the U.S. Postal Service made money -- $470 million.
As a result, Bolger told a Town Hall audience in Los Angeles, postage rates in effect since May 1978 will remain unchanged until 1981. Inflationary pressures will force the Postal Service to seek a rate increase then because the recent year's surplus is expected to be replaced by more common red-ink entries in the coming year.
However, while Postal Service officials previously had forecast a deficit of up to $1.2 billion in the current fiscal year, Bolger said yesterday that "we intend to have it to no more than $600 million."
The Postal Service broke into the black this year largely as a result of productivity gains it has achieved over the years, Bolger said. But with continuing wage increases and inflation -- the latter now running at 13 percent annually, and fuel prices rising een faster -- costs will more than catch up in the current year, he said.
A copy of Bolger's speech, prepared for delivery at the Town Hall forum, was made available in Washington.
The Postal Service surplus in fiscal 1979, which ended Sept. 30, was certified by the accounting firm of Ernst and Whinney International. It folows multimillion-dollar losses in every year since 1946 -- including losses of more than a billion dollars each in 1967, 1968, 1969 and 1970 before the old Post Office Department was transformed into a semi-independent postal service business at the start of this decade.
The new Postal Service also reported steep deficits at first but the trend has been down in recent years -- from $1.2 billion in 1976 to $688 million in 1977 and $379 million in 1978.
The annual deficit or surplus figures do not take into account federal appropriations to the Postal Service, designed to underwrite losses from specific public services such as rural delivery.
In the year ended Sept. 30, these government appropriations weree about $1.7 billion.
Discussing the Postal Service's recent performance, Bolger said yesterday that "any fair-minded observer must agree that [it] is a noteworthy accomplishment."
He noted that the Postal Service has pared its payroll from 740,000 in 1971 to about 665,000 this year at a time when mail volume rose from 86 billion pieces to 100 bilion. According to Boger, this translates into a productivity gain of more than 23 percent, at a time when much of American business productivity was stagnant.
Bolger attributed continued criticism about the quality of postal service to the public's general impatience with big government, and he insisted that past mistakes in some mechanization programs have been corrected to the point where most mail is delivered on time.
He said productivity gains had been made possible by modernization of facilities and an increase from 25 percent to almost 75 percent in the volume of mail processed mechanically, coupled with new rates designed to attract large-volume business users.
"Individual service lapses will, and do, occur. . . they always have," he declared. "But I think. . . that this is inevitable when you are dealing with the daily movement of 300 million items".
Bolger also argued against enactment of any additional government subsidies to keep rates at current levels. The cost of such a program would be $2.5 billion to $4.5 billion a year, he stated.