WASHINGTON -- Rep. Darrell Issa on Wednesday called for the U.S. Postal Service to clean itself up to avoid a potential taxpayer bailout, after the broke mail service announced it is suspending its employer contribution to its pension plan.

The post office said it has informed the Office of Personnel Management that the $115 million payment to the Federal Employee Retirement System  made every two weeks will be suspended effective Friday. The action is expected to free about $800 million in the current fiscal year. The post office's FERS account currently has a surplus of $6.9 billion, the agency said.

"We will continue to transmit to OPM employees' contributions to FERS and also will continue to transmit employer automatic and matching contributions and employee contributions to the Thrift Savings Plan," said Anthony Vegliante, chief human resources officer for the post office.

Issa, R-Calif., pointed out that the $800 million in savings doesn't even account for 10 percent of USPS' $8.3 billion deficit last year.

"The United States Postal Service, our nation's second largest employer, is now past the brink of insolvency," said Issa, chairman of the House Oversight and Government Reform Committee.

"This would not be tolerated in a private company. ... USPS needs fundamental structural and financial reforms to cut costs and protect taxpayers from an expensive bailout," Issa said.

Art Sackler, coordinator for the Coalition for a 21st Century Postal Service, a group representing the private sector mailing industry, said Congress needs to take action to reform the Postal Service.

"The USPS is hanging by a thread, along with 8 million private sector jobs that depend on the mail," Sackler said.

Over the last four years the Postal Service has cut its staff by 110,000 and reduced costs by $12 billion. The agency has also proposed eliminating delivery on Saturdays to save money and is working on closing small post offices and consolidating sorting and other operations.

The post office, unlike other federal agencies, is also required to make an annual payment of more than $5 billion as an advance contribution to future retiree medical costs.

But Sen. Tom Carper, D-Del., said In essence, this is the canary in the coal mine moment for the Postal Service is that even when it overpays into retirement accounts -- to the tune of $50 billion to $75 billion for the Civil Service Retirement System -- it is unlawful to remove the overpayments to pay for other expenses.

Carper said he has introduced legislation to change that while also getting Congress out of the way of trying to salve the USPS' wounds.

The legislation would "give the Postal Service the room it needs to manage itself and avoid it becoming the latest victim of congressional gridlock," Carper said, adding that without it, the mail service could "cease to exist in the very near future."

"A shutdown of an industry of its magnitude, with some 7 million employees and more than $1 trillion in revenue every year, would be catastrophic to our fragile economic recovery," Carper said in a written statement.

The Associated Press contributed to this report.