Major announcement about Post Office plan to block courier deliveries under 1kg

Minister of the Department of Communications and Digital Technologies, Solly Malatsi, intends to review the South African Post Office’s (Sapo’s) monopoly on certain postal services, including delivery of parcels weighing less than 1kg.

The Post Office was granted a 25-year exclusivity period under the Postal Services Act of 1998.

In a notice published in the Government Gazette on Tuesday, 11 March 2025, Malatsi said he would review the exclusivity period granted to the Post Office for reserved postal services.

He invited interested persons to submit written comments on the topic within 30 days of the notice’s publication.

“The Minister of Communications and Digital Technologies intends to review in terms of Section 16(8) of the Postal Services Act 1998, the period during which no person other than the South African Post Office may provide a reserved postal service,” the notice reads.

“The legislative framework requires Sapo to provide such services universally to every citizen in the country regardless of whether the Post Office derives financial benefit or not to ensure all citizens have equal access to a basic postal service.”

For reference, reserved postal services, as per schedule one of the Postal Services Act, include:

• Conveyance of all letters, postcards, printed matter, small parcels, packages, or wrappers and other postal articles weighing up to 1kg;
• Issuing and selling postage stamps; and,
• Providing roadside collection and address boxes.

Section 16(8) of the Postal Services Act requires the Minister of Communications and Digital Technologies to review the exclusivity period every five years or a shorter period that the Minister may determine.

Portfolio Committee for Communications and Digital Technologies member Sibongiseni Vilakazi recently conducted oversight visits to state-owned entities under the communications department in KwaZulu-Natal, including the South African Post Office.

The general consensus from management at the KwaZulu-Natal office was that the Post Office could generate sufficient income to sustain itself if it protected the monopoly on parcels under 1kg.

They also said the entity should focus on online shopping deliveries.

“There was an animated discussion on income generation, with many in attendance believing it is possible for Sapo to generate sufficient income to sustain itself,” Vilakazi wrote in his report.

“Securing the legislative advantages would help improve income.”

The South African Post Office has faced significant financial difficulties for over a decade, last posting a profit in 2013.

Since 2013, it has reported more than R19 billion in losses and grown its debt significantly.

This resulted in the state-owned entity entering business rescue in July 2023. In May 2024, Business Rescue Practitioners Anoosh Rooplal and Juanito Damons said maintaining its monopoly over deliveries under 1kg would be critical to its survival.

Malatsi’s review of the exclusivity period follows a similar review announced by former communications minister Mondli Gungubele in February 2024.

“We are hopeful that we will be granted the allocation,” Rooplal said at the time.

Plans for partial privatisation

In October 2024, Minister Malatsi revealed that the Department of Communications and Digital Technologies was considering partially privatising the Post Office and ending its exclusivity over deliveries under 1kg.

“The preferred outcome is for Sapo to get back on its feet by regaining the public’s trust, including public entities, not through compulsory use of its services,” the Minister said.

However, the Portfolio Committee on Communication and Digital Technologies disagrees. Chair Khusela Diko clashed with Malatsi over his plans and published a statement strongly opposing abolishing the exclusivity licence.

She agreed with Malatsi’s support of public-private partnerships and agreed with him that control should remain in the hands of government.

However, she said government should preserve, protect, and extend the Post Office’s competitive advantage.

“Sapo is a strategic state institution with an important mandate to connect people to one another and to the government in a fast-evolving technological age,” said Diko.

“As such, it must remain in the hands of the state, not beholden merely to commercial interests but committed to delivering on its universal service obligations espoused in the Postal Services Act of 1998.”