Post office to cut 4,700 jobs – and needs another bailout to do it

 ·4 Apr 2024

Roughly 4,700 retrenchment letters have been sent to workers of the South African Post Office (SAPO), and the Business Rescue Practitioners are looking to the government for more money to pay out retrenchment packages.

In a parliamentary Q&A in March, the Minister of Communications and Digital Technologies Mondli Gungubele noted that 235 post offices are due to close across the country, with most of them situated in the Free State and North West – followed by North Gauteng, Limpopo, and Mpumalanga.

Along with this revelation, the minister confirmed that more retrenchments were underway as a result, although he couldn’t comment on the exact number.

However, following consultation processes with the CCMA, Business Day reported that the Business Rescue Practitioners (BRPs) had begun sending 4,700 retrenchment letters to staff who would lose their jobs.

This means roughly 42% of the existing SAPO workforce is on the chopping block, with the Post Office being left with 6,383 staff – down from 11,083.

Despite this high number, it is notably less than the 7,000 jobs estimated to be at risk when the SAPO’s Business Rescue Plan was adopted in December 2023.

Speaking to the Sunday World, The Communications Workers Union (CWU) said the BRPs told them they were retrenching 5,148 workers – but this number dropped due to people who opted for voluntary severance retrenchments and natural attrition.

Most of the money needed to pay out the retrenchment packages over the next eight months will be sourced from the R2.4 billion bailout received last year.

However, Business rescue practitioner Anoosh Rooplal said the conclusion of the retrenchment payments was dependent on receiving the R3.8 billion bailout the SAPO asked for to fund its turnaround strategy to digitise SAPO to bring it up to speed with current technological developments in the postal environment.

This additional funding, however, was not granted by the National Treasury, and Rooplal noted the plan to rescue the business would be at risk without it.

During a parliamentary portfolio committee meeting, Deputy Communication Minister Mohlopi Mapulane stated that discussions between his department and the Treasury were ongoing to address the matter.

The SAPO has historically been bailed out with billions of rands. According to communications minister Mondli Gungubele, the public postal service received R10.3 billion between 2016 and 2024 – which effectively did nothing to turn the embattled SAPO around.

Read: Massive property, electricity and water rate hikes expected to hit major cities in South Africa soon

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