How much will switching the workers to a defined contribution plan help? That's one change that clearly needs to happen.
In January 2010, the Postal Service Office of Inspector General (Postal OIG) issued a report giving hope that the Services financial problems might be less severe than previously believed. The report asserted that the Office of Personnel Management (OPM) has forced the Service to pay an unfairly large share of the Civil Service Retirement System (CSRS) pension costs of postal workers who started their careers at the old Post Office Department.  According to the Postal OIG, the overpayment began in the 1970s and had reached a cumulative total of $75 billion through 2009. The Postal OIG claimed the overcharge benefited the U.S. Treasury and recommended that the Treasury credit $75 billion to the Postal Service. The OIG suggested using most of the money to fully fund the retiree health benefits that the Service promises to its workers. (Pensions and retiree health care are separate fringe benefits. Postal workers receive both in retirement.) If the transfer had occurred in 2010, it would have cut the Services retiree health benefit expenses by $7.7 billion that year and reduced the enterprises income-statement loss by an order of magnitude, from $8.5 billion to $0.8 billion.