131 branches the Post Office owns are empty and could be sold

Communications minister Solly Malatsi has revealed that 388 Post Office branches are currently standing vacant.

Of these, 257 were rented properties. The Post Office owns the remaining 131, and plans to rent them out or sell them.

Netwerk24 reports that Malatsi revealed the figures in response to a Parliamentary question by DA MP Nicolaas Pienaar.

“Where a branch was previously let, the space will be rented out and occupied by a new tenant,” he said.

“Where the branch was located in a property owned by the Post Office, it is considered vacant. The Post Office is currently considering selling or letting vacant properties.”

The regions with the most empty Post Office branches are the Free State and North West, which have 134 empty properties between them, followed by Limpopo, Mpumalanga, and Tshwane, which account for 70 vacant properties.

There are 67 empty branches in the Eastern Cape, 43 in KwaZulu-Natal, 43 in the Western and Northern Cape, and 31 in the rest of Gauteng.

Malatsi said the data was provided by the Post Office’s business rescue practitioners (BRPs), Anoosh Rooplal and Juanito Damons.

The Post Office was placed into business rescue in July 2023, with Rooplal and Damons tasked to formulate a plan to turn the ailing state-owned enterprise around. Their plan was adopted in December of that year.

As part of being placed into business rescue, the Post Office received a R2.4 billion injection from National Treasury, which it used to cover operations, settle debts, and pay salaries and severance packages.

In early September, the SA Post Office reported that 4,875 people had been retrenched out of the 11,083 total staff.

Of its 1,023 branches, only 113 were profitable, so 366 were closed. This left 657 branches nationwide.

Another R3.8-billion bailout

Rooplal and Damons’ plan banked on a further R3.8 billion bailout promised by government, however finance minister Enoch Godongwana said last year that this amount would not be forthcoming.

Damons and Rooplal previously warned that the Post Office would reach day zero on 30 October 2024 should it not receive a promised R3.8 billion bailout from government.

That was the same day finance minister Enoch Gondongwana delivered his medium-term budget policy statement last year. He vowed that the Post Office would not receive further bailouts.

“By the way, they told us D-day for the post office is today. But there’s no money in the adjustment as we speak,” Godongwana said in a press conference following the speech.

“We are hoping that the Department of Communications and Digital Technologies will find ways of reorganising and reprioritising their budget to deal with that question.”

Malatsi previously said his department’s budget does not have the resources available to rescue the Post Office and suggested public-private partnerships as the long-term solution to its financial problems.

However, this week his ministerial spokesperson, Kwena Moloto, said the Department of Communications and Digital Technologies asked Treasury to reallocate unused funds from SITA SA Connect.

SA Connect is the implementation of the national broadband policy that was approved by former President Jacob Zuma’s cabinet in 2013.

Moloto’s feedback came after a warning from the Communications Workers Union (CWU) that the Post Office could shut down at the end of February.

However, while the department has found funds to keep the Post Office afloat, Moloto warned that it was not a lasting solution.

“The reality is that the DCDT’s budget simply cannot sustain repeated bailouts,” he said.

“To secure the Post Office’s future, the focus is on finding practical, long-term solutions that modernise its operations and make it more competitive.”

Moloto said this includes exploring strategic partnerships that bring in financial and operational expertise, and reviewing existing regulations to ensure they support a more innovative and efficient postal service.

This latter statement is reitiration of Malatsi’s proposal to partially privatise the Post Office.

The minister previously said that his department had asked Treasury for support in forming a task team to “pursue private financial and operational partners” for the Post Office.

His vision includes government retaining a majority stake in the Post Office, while ending its monopoly as a reserved postal service in South Africa.