Canada
Special local rates have from quite early dates been in operation in America. If in England the lowest rate fixed for General Post letters had been found too high to afford reasonable accommodation for the public in London and other cities, it may well be imagined that the lowest rate in Canada, gauged as it was to the needs of a service which should cover
a country of vast area and ill-provided with roads, would be found altogether high for local letters. Moreover, in most places no sort of delivery service existed. Local letters could only be placed in the post office to be called for by the persons to whom they were addressed. In Canada the actual cost of the conveyance of the mail was consequently disproportionately high compared with other expenses of the service, and the justice of a lower rate for such letters as obtained no benefit from that expenditure naturally suggested itself. The lowest rate fixed by the Act of 1765 for transmission within Canada of a single letter was 4d., and, rather than charge such a rate on local letters, the deputies in Nova Scotia allowed such letters to be deposited in the post office free.
At Confederation a special rate for local letters of 1 cent per ½ ounce was established. At this time there was still no authorized house-to-house delivery of letters in any part of Canada, and local letters were actually what they are always termed, viz. "drop" letters. They were letters dropped into the post office letter-box and handed out at the office to the addressee on application. When in 1875 delivery by letter-carrier was introduced in certain towns, the drop-letter rate was not disturbed. It was thought, however, that a postage charge of 1 cent was not sufficient to cover the cost of the service of delivery at the place of address, performed by an expensive establishment of letter-carriers; and in 1889, on that ground, though much against the wishes of the mercantile community, the rate was raised to 2 cents an ounce in cities and towns where the system of delivery by letter-carrier was established, the existing rate of 1 cent per ½ ounce being continued in other cities and towns.
The ordinary letter rate was still 3 cents. This change therefore left all local letters with a lower rate than ordinary letters.[551]
The 2-cent rate proved to be too high. Much dissatisfaction resulted, and evasions were constant. In defiance of the
law, which conferred on the Postmaster-General the monopoly of the carriage of letters, merchants made arrangements for the transmission and delivery by their private messengers of their letters for local delivery. The evil assumed such proportions that the suppression of the private carriage of local letters was deemed out of question, and the Government concluded that the only satisfactory solution of the difficulty was the re-introduction of the general 1 cent drop-letter rate.[552] So great was the number of drop letters sent otherwise than through the Post Office that no actual loss of revenue was anticipated from a reduction of the rate, which should bring back those letters to the post. This anticipation was more than realized. In a very short time after the passing of the Act of 1898 legalizing the reduction to 1 cent, the gross revenue from local letters surpassed that obtained under the 2-cent rate.