SA Post Office to close 235 branches

ABOUT 235 South African Post Office (Sapo) branches are set to be closed, leading to employees being retrenched, after the conclusion of the section 189 process conducted by the Commission for Conciliation, Mediation and Arbitration (CCMA).

Among these branches, 104 are in the Central region (Free State and North West) 41 in the Northern region (North Gauteng, Limpopo, Mpumalanga and North West), 28 in the Western region (Western Cape and Northern Cape), 24 in the Eastern Cape, 21 in KwaZulu-Natal and 17 in Gauteng (most of Gauteng and the Vaal Triangle).

However, Communications and Digital Technologies Minister Mondli Gungubele could not say which Post Office branches would be closed. He could also not give the exact number of employees to be retrenched. The embattled public entity is currently undergoing a business rescue process.

“The joint business rescue practitioners are not prepared to share the actual list of branches as it stands whilst the process of liaising with landlords is in progress and the possibility of branch relocations are at hand. Once the list is finalised, same will be provided.

“The business rescue practitioners have advised that they cannot disclose the proposed number of employees that will face retrenchment as the section 189 facilitation process conducted by the CCMA is under way. The disclosure of a proposed number prior to the conclusion of the facilitation process jeopardises the course of action,” he said.

He made the remarks in response to three sets of parliamentary questions from DA MP Natasha Mazzone.

Sapo was placed under business rescue in July 2003. A business rescue plan was developed four months later and it was adopted by Sapo creditors in December 2023.

Joint business rescue practitioners Anoosh Rooplal and Juanito Damons, who were appointed to oversee the business rescue, previously indicated in December 2023 that Sapo had 1 023 branches, of which 894 were active and 129 inactive.

Rooplal and Damons had also indicated that they had ring-fenced R600 million for retrenchment packages to be paid over a 12-month period out of the R3.8 billion allocated for the business rescue process.

South African Postal Workers Union general secretary David Mangena said: “If, indeed, it is 235 branches, someone must come and explain why these branches are closed.”

Mangena also said it was shocking that Gungubele would not disclose the number of Sapo employees to be retrenched when he last year put the number at 7 000. Sapo will be left with about 3 000 employees if Gungubele's statement last year was true.

“Why does the minister not know now? Why did he make an announcement if he is unsure about the figure? The minister was supposed to keep quiet and allow the process to flow.”

He described the planned retrenchments as a bitter pill to swallow as the workforce of Sapo, when it was functioning well, was standing at 40 000 and now sits at about 10 000.

He also questioned why Sapo was allowed to degenerate when the entity did not pay statutory obligations such as pension and Unemployment Insurance Fund contributions to ensure that it met its obligations.

“It does not mean that the government was not aware. They have been aware. We still want more information on the branches to be closed – what is the modus operandi, which branches are to be closed and why,” Mangena asked.

Mazzone said yesterday that it was unacceptable that Gungubele and his ministry could not give a figure as to the status of Sapo right now and what it will be in the next month.

“I personally think 235 is the smallest estimate. There are going to be a lot more closures,” she said.

Mazzone noted with concern that the business rescue criteria have not been met and Gungubele has yet to provide a solution on how they will meet the requirements.

“We have to look at the amount of people who are going to lose their jobs. It is nothing more than an economic bloodbath,” she added.

Meanwhile, Gungubele said the National Treasury has not allocated any funding in the medium-term expenditure framework preliminary allocations for 2024.

“However, it has committed to further engage with the Department of Communications and Digital Technologies on the South African Post Office rescue plan as it forms the basis for the R3.8bn funding requirement.

“These discussions have commenced and the outcome will be provided upon the conclusion of engagements with the National Treasury,” he said.