Post Office bailout may cost thousands their jobs


Thousands of people could lose their jobs in an attempt to keep the Post Office’s doors open by putting the struggling state institution into business rescue.

The DA expects that up to 7,000 jobs will have to be cut to ensure that “any substantial turnaround is possible”. This is in addition to the 6,000 workers who have already lost their jobs and the 314 branches of the Post Office that have been closed over the past three years.

Natasha Mazzone, the DA’s spokesperson on communications and digital technology, says that despite the steps being taken to keep the Post Office running, its management still receives “inflated” salaries. The CEO and other high-ups will still have earned a combined salary of R7.7 million at the end of the year.

On Monday, the Pretoria High Court granted the government’s application to put the Post Office into business rescue.

This follows after Mondli Gungubele, Minister of Communications and Digital Technology, submitted an urgent application to prevent the Post Office from being finally liquidated.

The Post Office will now receive R3.8 billion that the government earmarked as part of a so-called turnaround plan. The Post Office has already received R2.4 billion from this year’s national budget.

The government also gave the Post Office more than R7.3 billion in bailouts between 2016 and 2019.

“Despite all these bailouts, the Post Office still recorded R2 billion in annual losses and R8 billion in liabilities,” says Mazzone.

“Under the ANC, state institutions have become a black hole for bailouts, with no political will for sustainable solutions.”

The DA appealed to the finance minister to explain why the Post Office received another bailout and which programs will suffer at the expense of it.

The DA is also going to write to the minister of communications “to urgently stop the impending job losses and to cut the salaries of the management instead, unless he wants 13,000 job losses to be his legacy”.

“He must also explain what the bailout will be used for, what the targets and timelines are, and why this bailout will work when others haven’t since 2014.”