Minister Malatsi Must Intervene in SAPOS Crisis

Dear Editor

During yesterday’s Portfolio Committee on Communications and Digital Technologies, it was revealed that the South African Post Office (SAPO) is projected to run out of funds next month, in October 2024, potentially forcing the entity back into liquidation.

The DA calls on Minister Solly Malatsi to take immediate and decisive action to prevent SAPO from reaching Day Zero

This crisis comes even though since 2014, SAPO has received more than R10 billion in taxpayer funds. Yet, despite these significant financial injections, SAPO has shed approximately 10 000 jobs and closed more than 400 branches. Last year, SAPO was provisionally liquidated due to its failure to settle nearly R13 billion in liabilities, a situation so dire that many branches could not even pay rent, leading to legal actions by landlords.

In a last-minute attempt to save SAPO, National Treasury stepped in with promises of bailouts, resulting in a R6.2 billion assurance and placing SAPO under business rescue. However, the DA warned at the time that Treasury’s intervention was unsustainable, given the depleted state of our country’s fiscus. The reality is now clear: Treasury cannot fulfill these assurances, and SAPO remains in a perilous financial state.

The DA believes that the only viable path for SAPO’s survival lies in the private sector, which possesses the necessary expertise, funding, and infrastructure to manage and rehabilitate the institution. The time has come to face this reality with urgency and decisiveness.

The situation requires more than just rhetoric; it requires a concrete and actionable plan that prioritises the sustainability of SAPO and the protection of its critical services, especially the distribution of social grants to our most vulnerable citizens.

The DA calls on the Minister to:

• Engage with private sector partners: Initiate discussions with potential private sector partners to explore opportunities for collaboration, investment, and management that could salvage SAPO from its current trajectory.
• Ensure transparency and accountability: Provide a transparent update on the status of SAPO’s finances, the progress of the business rescue process, and the measures being taken to prevent a complete collapse. The public has a right to know how their money is being spent and what steps are being taken to protect this critical national asset.
• Develop a long-term strategy: Work with all relevant stakeholders, including Treasury, SAPO management, and civil society, to develop a long-term strategy that ensures SAPO’s sustainability without relying on unsustainable bailouts from the public purse.
• Protect Essential Services: Ensure that essential services, particularly the distribution of social grants, are not disrupted. The potential collapse of SAPO would have devastating consequences for millions of South Africans who rely on these services.

The DA remains committed to working with all stakeholders to find a viable solution for SAPO. We will continue to hold the government accountable and advocate for the necessary interventions to prevent a national disaster.

Regards

Tsholofelo Bodlani MP
DA Spokesperson on Communications and Digital Technologies