Meltdown at the Post Office

Around 15,000 South African Post Office (Sapo) workers could lose their medical aid cover with Medipos from October because their employer owes the insurer R602 million in member contributions.

The Sunday Times has reported that Medipos sent a letter on the decision to the impacted Sapo employees last week.

Medipos principal officer, Thabasiwe Mlotshwa, explained that Sapo had not paid the scheme contributions made by employees in the last 15 months.

“On the odd occasion that we do receive some form of contribution, it will only be partial payment,” said Mlotshwa.

The scheme used reserves to pay claims and expenses while not receiving full contributions, and this had been depleted to R233 million as of August 2021.

“Despite continued engagements with Sapo executives and the escalation to the Sapo board, these engagements have not borne any outcome that will ensure the long-term sustainability of the scheme,” Mlotshwa stated.

“The board has regretfully had to come to a decision that should your arrear contribution not be received by September 30, your membership will be suspended with immediate effect from October 1.”

“This means you will have no cover for medical expenses,” Mlotshwa added.

A Post Office spokesperson confirmed to The Sunday Times that the postal service’s payments were in arrears due to a massive drop in revenue caused by the Covid-19 pandemic.

The spokesperson said the contributions would be transferred as soon as revenue levels returned to normal.

It is not the first time Medipos has informed Sapo employees of its employer’s failure to pay the scheme the contributions it was taking from their salaries.

Almost exactly a year ago, it sent a letter to members in which it revealed Sapo owed it R213.3 million.

At the time, the Communication Workers Union claimed the contributions were being deducted from salaries and shown on payslips but weren’t paid to the providers.

Post Office employees have also told MyBroadband that pension fund deductions were taken from their salaries but not paid into pension funds.

Post Office
Post Office

The Post Office is facing an uphill battle against a total meltdown.

In April 2021, Auditor-General Tsakani Maluleke revealed it was commercially insolvent.

Maluleke said that over the 2019/2020 financial year, the Post Office incurred losses of over R1.7 billion while its liabilities exceeded its assets by R1.5 billion.

The deplorable state of the postal service is evident based on the situation at its branches.

MyBroadband previously visited numerous Post Office branches in Gauteng, and many of them had signs about service delivery problems in their windows.

Post Office Close

One branch did not have electricity since the beginning of 2021 because the Post Office had not paid the landlord, who then disconnected their power.

Another branch said vehicle license services were offline. “Please go to the nearest Post Office”, a message in the branch window said.

Business Day reported that many landlords and service providers were struggling to get money from the Post Office, with the company’s unpaid invoices totalling R638 million as of March 2021.

Now read: Post Office has a plan to take over online shopping deliveries — and it will make you mad

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Meltdown at the Post Office