The United States Postal Service (USPS) announced Monday that it is set to default on a huge $5.5 billion benefits payment due Aug. 1. This will be the first time the Postal Service is unable to make the payment, used toward future retiree health costs and required by the federal government.
The struggling USPS is also set to default on an additional $5.6 billion due Sept. 30, which it also says it cannot pay. It lost $5.1 billion in fiscal year 2011.
The organization reassured patrons, employees, and retirees in a statement released July 30: “This action will have no material effect on the operations of the Postal Service. We will fully fund our operations, including our obligation to provide universal postal services to the American people,” stated the Postal Service.
“We will continue to deliver the mail, pay our employees and suppliers, and meet our other financial obligations. Postal Service retirees and employees will also continue to receive their health benefits.”
