Post Office must fire 6,000 workers — or die

The South African Post Office’s creditors have voted in support of the Business Rescue Plan developed by its joint business rescue practitioners.

The plan, created by Anoosh Rooplal and Juanito Damons, involves restructuring the SA Post Office (Sapo) so it can provide its mandated services to all households in South Africa. This includes cutting thousands of jobs.

Rooplal and Damons have been working with the Post Office management to address its financial issues.

“The Post Office fulfils an important social mandate intended to provide key basic communications services to all households, including the rural areas, where access to Wi-Fi, smartphones and printers are not a given,” said Rooplal.

“A restructured Post Office can do this affordably and conveniently, given certain regulatory pricing and geographic reach of the branch network.”

Rooplal and Damons say the restructured Post Office will also contribute to the financial sustainability of many other businesses, regardless of their size, and to the country’s tax revenue through increased employment as it grows.

Their plan will be carried out in two phases over two to five years, with the first phase focusing on stabilising Sapo and reducing its headcount to around 5,000 employees.

This means Sapo will retrench just over 6,000 employees, which is more than half of its current headcount, according to an update from the joint business rescue practitioners in November 2023.

At the time, Rooplal and Damons said Sapo had 11,048 staff, which means the company had reduced its headcount from almost 14,500, as reported in its 2022 annual report.

The Post Office will focus on up-skilling the remaining staff and employ “digital specialists and leaders” to assist with its modernisation.

“Focus will be on improving service delivery levels, which will include increasing its fleet to deliver letters and parcels timeously,” the they said.

“New digital products will be considered and launched to increase revenue streams, while automating more of the daily tasks.”

The plan’s second phase will kick off the “Post Office of Tomorrow” strategy, hoping to achieve the outcomes defined in the Postal Amendment Bill.

This includes offering diversified and expanded services through hybrid mail extensions, new vehicle licence disc renewal solutions, and creating a digital hub.

“We thank those creditors, who voted in favour of the Plan. We believe that with our continued involvement, hard work and detailed strategy, we can restructure the Post Office into a future-proofed business that can provide ‘communications inclusion’ for all South Africans,” said Rooplal.

The business rescue plan is critical for Sapo, with Rooplal and Damons revealing that it was completely insolvent as of July 2023

They also said the Post Office’s debt obligations had increased to R12.5 billion.

“The SAPO asset base is dwarfed by its total liabilities of approximately R12.5 billion as of 31 July 2023,” they said.

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Post Office must fire 6,000 workers — or die