Australia Post will cut 400 workers after posting a first-half loss of $189 million.

Addressing the American Chamber of Commerce in Melbourne yesterday, Paul Graham said the government needed to “get in front of change” in order to save the public service.

“Qantas is no longer owned by Australian taxpayers. Neither is Telstra. Australia Post is,” he said.

“The imperative for change is clear. We are governed by the 1989 Australian Postal Corporation Act – an instrument legislated before the internet boom and the creation of smartphones, when letters were the dominant form of communication, online shopping was yet to take hold and digital service-provision largely did not exist.

“Performance standards issued under the Act are no longer fit for purpose to Australia Post as an enterprise or to the customers and communities we serve every day.

“At the moment it (the Act) is quite restrictive in the language that it uses, it was written in 1989 before the advent of e-commerce, so we will work through with the government at what clauses or areas need to be changed.

“But the key thing is making sure if there are changes that they allow us to have the flexibility as an enterprise to make sure we can be commercially sustainable.

“Certainly where it (the Act) proscribes we must deliver the mail five days a week to every household in Australia, 98.5 per cent on time, again if you asked the average consumer out there is that important to them they would probably say not really and that parcels are important to me.

“The provision of the community service obligation that is wrapped up in that is also something obviously we are committed to and is part of the Act, and then the way the pricing is regulated around the price of a stamp is quite a draconian, old world process.”

Graham urged politicians to “put the national interest first.”