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US Postal Service Defaults on Benefits Payment

By: CNN
By: CNN

The US Postal Service has defaulted on benefits payment.

The $5.6 billion retiree benefits payment was missed on Sept. 19. Post Master General Patrick Donahue had warned a Senate Committee it would happen.

During that testimony, Donahue said the post office was in the midst of a financial disaster. He said the agency is burdened by an out-dated and inflexible business model that prevents it from making payments.

This is not the first time the Postal Service has defaulted on the payment. Unlike other Federal Agencies, the Post Office is not funded by taxpayers. It is intended to operate like a private business.

An agency spokesperson says the default isn’t related to the Government shutdown.


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