Post Office rescue plan slammed for lack of transparency and strategic detail

The Select Committee on Economic Development and Trade expresses concern about the work of business rescue practitioners on the South African Post Office’s (Sapo) turnaround strategy.

This follows the practitioners’ plan presentation in parliament on Wednesday, which outlined the progress being made.

According to the practitioners, their long-term vision is to transform the Post Office into an e-commerce hub and multipurpose service centre.

Concerns about further job losses and transparency

Committee chairperson Sonja Boshoff said troubling realities remain. The biggest being the retrenchments of more than 4 000 employees, with no confirmation that there will not be any further job losses.

“Service delivery at the Post Office has significantly deteriorated, and the entity continues to survive on state bailouts. Public confidence has been completely eroded, and the long-term sustainability of Sapo remains in serious jeopardy,” Boshoff said in a statement on Thursday.

She also raised concerns about the practitioners’ request to present substantial portions of the turnaround strategy in a closed session.

“Sapo is a state-owned enterprise funded by public money. The use of in-camera briefings must remain the exception, not the rule.

“Such briefings should only be permitted in instances of legitimate commercial sensitivity – not as a tool to shield institutional failures from public scrutiny and parliamentary oversight,” Boshoff said.

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Timelines and funding clarity

The prevention strategy has been criticised for offering limited details regarding innovation and measurable outcomes.

The committee notes that while the plan references digitisation, a revised branch footprint, and hybrid financing models, these aspects remain vague, lacking implementation timelines and funding clarity.

It is troubling that no investor has yet shown serious interest in supporting the turnaround of the national postal service, Boshoff said.

Unanswered questions

She said the following key questions remained unanswered:

• How many of the retrenched employees have actually received support through the Temporary Employer-Employee Relief Scheme (Ters) fund?
• What efforts have been made to engage the private sector in restoring core service functions?
• On what basis is Sapo still classified as a “strategic national asset” while continuing to rely on repeated state bailouts?
• How will the proposed hybrid funding model work in practice, and who will ultimately bear the financial risk?

“It is imperative that public institutions – particularly those under business rescue and funded by taxpayers – operate with transparency, accountability, and defined performance indicators, the committee chairperson said.

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“A turnaround plan cannot rely on slogans or structural tinkering. It must restore credibility, modernise operations and rebuild trust with the South African public who depend on these services.”

Clarity, accountability and transparency

Boshoff also emphasised that as the committee continues its oversight work, it will insist on greater clarity, stronger accountability and full transparency from all parties involved in the business rescue process.

“The relevance of the Post Office in the broader communications and logistics sector is fast diminishing.

“This can only be reversed through genuine diversification of its service offering and complete modernisation of its operations,” she said.

Retrenchments and saved jobs

A total of 4 875 employees were retrenched in 2024 after Post Office entered business rescue, with a R8.7 billion debt.

In May, it was announced that Sapo and the Unemployment Insurance Fund (UIF) agreed on a deal to fund salaries of the remaining employees while the government works to restore the postal service’s fortunes. 

The agreement saw the return of Ters, used during the 2020 global health pandemic.

Ters will inject R381 million into the post office over six months to assist 5 956 employees.

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