Minister of Communications Mondli Gungubele has confirmed the significant downsizing efforts underway at the South African Post Office (Sapo).
During a media briefing on Thursday, Gungubele failed to provide the exact figure. But it was reported earlier this week that there are approximately 4,700 jobs on the line. This as the organisation grapples with financial turmoil.
Mounting challenges
According to reports, Sapo, currently undergoing business rescue proceedings, has faced mounting challenges. These prompted drastic measures to streamline its operations. The reported job cuts represent around 42% of the Sapo workforce. Closures are anticipated in various regions including the Free State, North West and North Gauteng. Also Limpopo and Mpumalanga.
The Business Rescue Practitioners (BRPs) overseeing the restructuring are seeking additional government funding to cover retrenchment packages. Initially, projections estimated up to 7,000 jobs at risk. However, voluntary severance and natural attrition have mitigated the final tally to 4,700.
Gungubele emphasised the government’s commitment to salvaging the SAPO. This will ensure the continuity of essential services despite the ongoing challenges. With the adoption of the Sapo Business Rescue Plan by creditors in December 2023, efforts are underway to restructure the organisation into a leaner, more efficient entity, he said.
Government committed to salvaging the entity
“As announced by the Minister of Finance during the 2023 Budget Speech, Sapo has been allocated R2.4-billion. This to assist in bringing stability to this entity. Saving the SA Post Office and turning it around into an effective, innovative and financially viable entity remains the foremost priority of this government.
“The restructured Post Office will be lean, agile and cost effective. The BRP continuously engages labour representatives to ensure a seamless process on all labour-related issues.
“The branch closures will be effected in a manner that does not compromise the universal service obligations of Sapo. Altogether, there shall be 653 branches remaining open by the end of the year,” he said.
SA Post Bank stable, plays pivotal role
Moreover, Gungubele provided updates on the state-owned South African Post Bank (Post Bank). He highlighted its stability and pivotal role in distributing social security grants.
Gungubele emphasised that Postbank continues to solidify its position in the financial landscape. This with close to 5 million grant beneficiaries and nearly 3 million additional customers.
Postbank’s pursuit of a banking license remains on track, he said. This is bolstered by recent key appointments. These include a permanent CEO with extensive banking experience.
Over the next three years, the bank aims to enhance its business capabilities. This will focus on stabilisation and growth. Also differentiation strategies to meet evolving customer needs.
Customer value propositions
“To ensure each market segment is catered for and their customers’ needs are met, Post Bank has established customer value propositions.
“The bank is currently testing the new banking cards, which have already been verified by Visa as being compliant. This is the biggest step the business has ever achieved in the variation notice over the past three years.
“We are also in the process of finalising the appointment of the new board,” he said.
