The South African Federation of Trade Unions (SAFTU) demands urgent and decisive
action to save the South African Post Office (SAPO) from liquidation. In its recent
MTBPS, the Minister of Finance, Enoch Godongwana, was conspicuously silent about
allocating the R3,8 billion to the SAPO in line with the undertaking the government
made in court to save it from imminent ruin.
The cash flow problems that have haunted the SAPO compelled it to enter into business rescue three years ago to avert liquidation. In this process, the SAPO received R2.4 billion from the Treasury as part of the business rescue deal. With these funds, the business rescue practitioners settled the entity’s debt obligations and restructured it with the business rescue plan. Since entering business rescue, the SAPO has registered progress. Between June 2023 and June 2024, the SAPO has turned its net asset value from a negative R7.9 billion to R840 million, bringing it into solvency. Furthermore, the SAPO has since seen operations improve – reducing backlogs in its mail centre and completing data centre migration.
However, despite these recorded partial successes, the Treasury has refused SAPO’s request for additional funding of R3.8 billion to complete the business rescue process. The requested additional funds are meant to settle accounts with the remainder of the SAPO’s creditors, recapitalise it, and put it in a viable, solvent position.
The Finance Minister’s conspicuous silence about the provision of funding for completing the business rescue plan in his MTPBS on the 30th of October 2024 is a slap in the face to the working class. The turnaround of the SAPO to solvency at a net asset value of R840 million came at an enormous sacrifice for the workers and the communities that rely on SAPO for services. Thus far, over 4,875 employees – which constitutes 43% of the initial workforce of the SAPO – have lost their jobs, and 366 branches have closed, leaving innumerable working-class households unable to access the indispensable services provided by SAPO. If the SAPO were to be liquidated, it would mean that all this loss and suffering was for nought, thanks to the Treasury!
The SAPO has a Universal Service Obligation mandate; therefore, it must be saved and retained in public hands. If its liquidation were a reality, the consequences would be devastating for the working class, most of whom are in rural areas.
Implications for the working class should the SAPO be liquidated.
1. The 657 remaining operational branches would close down, which would be catastrophic for heavily reliant, mainly rural communities. Vulnerable communities that depend on the SAPO to access their grants, mail, and other financial services would be left without recourse. This would mean additional transportation costs and, thus, logistical barriers to accessing essential services like affordable banking and grants for the already poor and under-served.
2. Five thousand seven hundred remaining workers would lose their jobs, with catastrophic results for these primarily black and elderly women workers who support up to 15 of their unemployed immediate and extended family members. This translates into 85,500 working-class family members who would immediately be consigned into the unimaginable pit of poverty.
We demand the following:
1. The SAPO must be given the R3.8 billion requested by the business rescue practitioners to complete the recapitalisation process of SAPO and thereby put it in a viable position.
2. Government to Prioritize SAPO Business: We insist that the government lead by example by doing business with SAPO. All state departments and entities should use SAPO’s services first to ensure that it has a stable revenue stream and can remain operational.
3. Recapitalisation for Infrastructure Development: We call for SAPO’s immediate recapitalisation, with funds directed toward infrastructure development. This investment is critical to modernising SAPO’s facilities and enhancing its service delivery.
4. Skills Development Programs: The federation emphasises the need for robust skills development initiatives to upskill SAPO employees. This will ensure workers adapt to technological advancements, improving overall efficiency and service quality.
5. Protection of SAPO’s National Footprint: SAFTU demands that SAPO safeguard its national footprint, particularly in rural and underserved areas. SAPO must continue to provide essential services to all citizens, regardless of geographic location.
6. Transformation into a Multi-Purpose Service Point: SAFTU proposes that SAPO be transformed into a multi-purpose service point, offering a broader range of government and financial services in addition to traditional postal functions. This will boost SAPO’s relevance and revenue generation, positioning it as a more versatile institution.
SAFTU strongly opposes privatisation and retrenchments. It is within the power of the government to save this vital service to the poor and marginalised communities only if it has the political will to do so. SAFTU calls for government intervention to restore SAPO to solvency and viability so that the much-needed services it renders to working-class poor communities are not lost.
We shall demand an urgent meeting with the President and the Minister of Finance to advance these demands. In addition, we are calling on the unions organising SAPO, mainly our affiliate DEPACU, to intensify ongoing protests. We call on the rest of the working class to join these protest actions. We call on our provincial structures to coordinate these activities so that our members’ voices are augmented.
