By Lehlohonolo Lehana.
The South African Post Office (SAPO) was placed under the provisional liquidation on February 9 following a successful court application by a creditor.
This is despite receiving a bailout of over R2 billion from National Treasury in the February budget.
In total, the Post Office owes creditors over R4 billion.
The Democratic Alliance said that the news on Wednesday that the South African Post Office has been placed under liquidation came as no surprise.
DA MP, Dianne Kohler-Barnard, said in a statement that her party has repeatedly called for this after an order was granted in favour of a single creditor and provisional liquidators appointed.
“This liquidation may indeed be the final straw for one of the most mismanaged entities within the Communications department,” she said.
Kohler-Barnard said SAPO lost millions in taxpayer money annually since 2013, adding that it “has slowly collapsed, despite massive bailouts,” while slashing jobs and closing branches countrywide.
She also said that the medical and UIF contributions of employees and retired workers, which she said had not been paid over for many years, are met in full.
“We stand firm in our belief that the Post Office, being one of the many bottomless pit state-owned entities battling operational issues, is beyond repair, and should be liquidated,” she said.
Meanwhile ex-Sapo CEO Mark Barnes (Purple Group Chair) said he submitted a ‘self-solving’ plan for the South African Post Office, but government simply ignored it.
Barnes outlined what he says was his “self-solving” proposal.
“I essentially said, get some independent body like the Auditor-General to determine what the net asset value is of the group… let us then determine what the present value of the forecast losses is, and I’ll pay you the net of those two numbers and I’ll undertake to fund those losses in an instrument which would also be self-solving.
Government would have retained 25-40% he said, with an international consortium in control with 60-75%.
10% he adds, would have been “pretty much given” to Post Office staff as the consortium couldn’t afford increases in the near-term.
That offer is worth R2.4 billion less today because they’ve just put in R2.4 billion! They would have had to NOT fund future losses and they would have retained 25-40% of the upside, we would have around 16 000 people still employed, we’d have an operating functional bank.
When he left the Post Office in August 2019 it was the only SOE other than the Reserve Bank that had no Treasury guarantees or outstanding liabilities with Treasury, Barnes added.