Maladministration by SA Post Office vindicates complaints by publishers

The investigation and report by the Public Protector into allegations of corruption, maladministration and misconduct by the management of the South African Post Office (SAPO) was published on 23 February 2016.

The findings vindicate the formal complaints lodged against SAPO by publishers with the Independent Communications Authority of South Africa (ICASA).

After the complaint was lodged on 11 December 2014, and a long process of apparent stone-walling and delays by SAPO management, the matter was finally heard by ICASA’s Complaints and Compliance Committee (CCC) on 2 July 2015, and then again on 5 November 2015.

But the CCC has still not released its findings some 14 months after the complaint was lodged.

It is hoped that ICASA will take note of the Public Protector’s investigation, report and findings in reaching its conclusion on the complaints against SAPO by magazine publishers in South Africa, and that this will give ICASA the confidence to act to protect the interests of the public against the failures of its licensee to meet its license obligations.

The complainants are asking ICASA, as regulator, to review SAPO’s failure to meet its license conditions during massive labour unrest and strikes by the SAPO workforce in 2014, taking into account the resulting financial and other damages to the magazine publishing industry, and to sanction SAPO accordingly.

The SAPO legal team argued in defense of SAPO that the strike actions had made due performance of SAPO’s license conditions impossible.

This argument was rejected by the legal team of the complainants, who presented case law which showed that the argument of impossibility (i.e. force majeure, or “an act of God”) does not and cannot apply in respect of SAPO’s obligations, and even if applicable, could not be relied upon as a defense when the cause of the claimed impossibility is, in fact, self-inflicted.

In this regard, the legal team of the complainants pointed out the widely reported management problems at SAPO during 2014 and 2015, including:

  • the removal of the entire previous board of directors and the later resignation of the COO and acting CEO;
  • the appointment by President Zuma of an investigation into alleged corruption at SAPO;
  • the investigation by the Public Protector into allegations of corruption, maladministration and misconduct by SAPO management;
  • the severe financial problems of SAPO resulting in the placing of SAPO under the administration of National Treasury;
  • ongoing problems in paying salaries timeously to SAPO staff and workers;
  • the refusal by SAA to carry SAPO mail due to non-payment; and
  • late payment and non-payment of suppliers and rent on premises leased by SAPO.

In addition, the legal team of the complainants presented a research report, dated February 2015, by Prof. David Dickinson, Professor of Sociology at the University of the Witwatersrand, entitled: Fighting their own battles: The Mabarete and the End of Labour Broking in the South African Post Office, on the background and causes of the strike actions.

The complainants’ legal team relied upon Prof. David Dickinson’s research report to argue that SAPO’s labour problems and strikes resulted directly from management neglect, over an extended period, in what is referred to as the “dirty secret” of large-scale use of temporary labour on a permanent basis (through labour brokers), in breach of legislation.

They argued that this resulted in grossly unfair and discriminatory labour practices by SAPO, leading to widespread labour unrest and strikes.

Subsequently, the investigation and report by the Public Protector published on 23 February 2016 entitled “Postponed Delivery” has now found that SAPO improperly appointed these labour brokers without following proper procurement processes.

The labour brokers then operated without written contracts, and this incurred irregular expenditure of R2,735-billion by SAPO, in violation of the Public Finance Management Act (PFMA) and the Constitution.

The Public Protector further found that this constituted maladministration, improper conduct and dereliction of duties by SAPO management.

The publishers believe that their complaint goes way beyond their own narrow business interests, and gets to the heart of the much bigger and urgent need by the country, the economy and millions of citizens of South Africa – particularly the poor – for a functional, reliable and efficient postal service.

Details of the complainants and the complaint

The complainants are collectively represented by Bouwer Kobeli Morabe Attorneys, and include: Brooke Pattrick (Pty) Ltd, Creamer Media (Pty) Ltd, Crown Publications (Pty) Ltd, EE Publishers (Pty) Ltd, Interact Media Defined (Pty) Ltd, Now Media (Pty) Ltd, Technews Publishing (Pty) Ltd and TE Trade Events (Pty) Ltd.

In terms of the relevant legislation, ICASA is tasked with the monitoring of SAPO to ensure the conditions of its license are met, and to hear and deal with complaints against the licensee where alleged breaches of license conditions occur.

The complainants are asking ICASA to consider and review its numerous complaints against SAPO and the financial and other damage to the magazine publishing industry caused by SAPO’s extended failure to meet its license conditions, and to sanction SAPO accordingly.

This could include: punitive financial sanctions against SAPO; entertaining alternative license applications to that of SAPO; considering additional license applications to supplement the activities of SAPO; or even, as a last resort, the removal of SAPO’s (currently exclusive) license.

The complainants are also considering a possible action for damages sustained by them resulting from the failure of SAPO to meet its license conditions and statutory obligations.

However, before such action, the publishers will follow all other avenues of due process, which includes the long-awaited findings of the CCC in response to the formal complaint to ICASA detailed above.

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Maladministration by SA Post Office vindicates complaints by publishers