Yeah, Canada Post is definitely in the “need to have” service list in Canada. In urban areas Canadians might be able to go without it and use private services like couriers and Amazon, but the price for that gets really high really fast outside city limits. And there’s a LOT of the country outside city limits….
Canada Post is in a bad strategic position, too, because it’s obligated to cover the whole country. Couriers and Amazon can out-complete on labour prices in the population-dense urban areas that generate surplus revenue (for a Crown corporation, profit if it’s a private company), so Canada Post loses market share in desirable areas. At the same time, it also has to serve low-population areas that a private company wouldn’t touch with a stick because they aren’t profitable, no matter how little you pay the delivery workers. If it were a wargame, it’s one of those scenarios where you know you’ll get over run eventually, the question is how long you can hold the perimeter?
So, yeah, Canada Post needs to be on the list of services that get core funding, because not having mail service in rural areas will create some nastier problems than coughing up the money, and privatized services won’t cover those areas. Not an easy situation at any level, though, because federal funding has real limits, and multiple legitimate priorities, not least of which is the need to make a long overdue very large investment in the Canadian Forces. Actually, maybe there’s the answer - replace the Canada Post fleet with LAV 4s and the occasional Leo 2 and get double duty out of the investment - guaranteed delivery in peacetime and a ready reserve if things go hot, would just need a quick green paint job!