Goodbye Post Office — over 300 branches closed in three years

The struggling South African Post Office (SAPO) has lost about a quarter of its branches in the past three years.

That is according to a response from communications minister Mondli Gungubele to a question in Parliament raised by Democratic Alliance MP Dianne Kohler Barnard.

Gungubele revealed between 1 April 2020 and 5 May 2023, 314 branches were permanently closed.

Before the Covid-19 pandemic, there were roughly 1,300 Post Office branches nationwide.

The loss of 314 branches means the beleaguered state-owned mail carrier now has over 24% fewer branches.

While SAPO previously attributed much of its downturn in business to Covid-19, it is interesting to note that only 22 of those closures happened during the height of the pandemic — the 2020/2021 financial year.

In the 2021/2022 and 2022/2023 financial years, a further 146 and 122 branches were closed, respectively.

During the two months since the start of its current financial year, the Post Office closed another 24 branches.

Assuming this year’s trend continues for the remaining months, SAPO could shutter close to 300 more branches in 2022/2023.

The Post Office has been losing money since 2013 and is now technically insolvent.

The entity has cost the taxpayer a pretty penny in bailouts amounting to R10.39 billion since 2014.

It was placed under provisional liquidation earlier this year after failing to pay its growing mountain of debt.

The government has approached the court to avert the impending liquidation in favour of a business rescue process.

It proposes to cut 7,000 of the roughly 11,000 SAPO employees to shed about R1.5 billion a year in employee costs.

Its losses have exceeded R2 billion a year over the past three years. As of March 2022, SAPO’s total liabilities exceeded its assets by R4.08 billion.

It is expected to make a net loss of R2.1 billion in the 2022/2023 financial year.

In the past few years, the postal service has struggled to pay the rent and utility bills of some of its branches.

It has also failed to pay the appropriate employee contributions into pension and medical aid funds.

SAPO has seen a gradual downturn in business as many items previously delivered through physical mail— such as account statements and legal notices — are now being sent via e-mail.

Outperformed by private players

South Africans have also increasingly turned to private couriers for deliveries of other packages due to SAPO’s infamous reputation for lost or delayed parcels.

A prime example of this was a Durban family that recently received a package sent from New York over 13 years ago.

Multiple MyBroadband tests in the past few years have also shown the Post Office performs very poorly compared to private courier services.

In one instance, a package sent from Gqeberha to Centurion took an eight-month trip across the country, only to return to its originating branch.

A significant customer that recently dropped SAPO’s services is Telkom.

The telecoms company informed subscribers that it no longer supports account payments at Post Office branches.

Telkom said this move intended to “streamline” payment processes for customers.

The fact that the telecoms operator is partially state-owned makes it all the more embarrassing for the wholly state-owned postal service.

DA MP Natasha Mazzone has warned the closing of SAPO branches would come at a cost to the poorest South Africans — social grant recipients.

“If this trend continues, individuals may be forced to travel long distances to the nearest Sassa outlet, exacerbating their already challenging circumstances,” Mazzone said.

Now read: Uber One launches in South Africa — with money back for late deliveries

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Goodbye Post Office — over 300 branches closed in three years