Cape Town - The portfolio committee on communications and digital technologies has cautiously welcomed Minister Solly Malatsi’s announcement that the government is considering the option of privatising the SA Post Office (Sapo).
Malatsi made the announcement as Sapo seeks another government bailout.
Should the government fail to provide the almost R4billion in funding it needs, Sapo said it could be at risk of liquidation.
But the Congress of South Africa Trade Unions (Cosatu) has condemned calls to either privatise or liquidate the Post Office, saying it was abominable that the parastatal’s workers had been pick-pocketed for years.
Cosatu’s acting spokesperson and parliamentary coordinator Matthew Parks said despite numerous interventions from the trade union confederation with government and the business rescue practitioners, Sapo workers had paid the price for mismanagement.
“In spite of promises made by the Business Rescue Practitioners of a plan to turn Sapo around, things have gone from bad to worse with over 200 branches closed and some simply abandoned to vandalism and criminals, and up to 6 000 staff retrenched in an economy with a 42% unemployment rate.
“Calls to privatise or liquidate Sapo must be abandoned. Sapo was once a thriving public entity until the decade of state capture and corruption. With competent management, financial relief and repositioning, Sapo can once again play a leading role in the postal sector,” said Parks.
In early September, a formal application for R3.8 billion in funding for the Sapo from the National Treasury was submitted.
Joint Business Rescue Practitioners (BRPs), Anoosh Rooplal and Juanito Damons, said these funds were needed in order to fully implement the approved business rescue.
Malatsi has now suggested that privatisation scenarios could be a viable or preferred option instead of a huge government bailout.
The minister has since asked for the support of National Treasury to look into the privatisation for the ailing post office. Malatsi also called for a task team to be set up to explore and find private financial and operational partners to assist Sapo.
This task team will also explore the best ways to include private partners in getting the post office back on its feet.
“This will enable serious consideration of privatisation scenarios as a preferential option to further funding from the fiscus,“Malatsi said.
“In addition, we will work to ensure that there is accountability for failure to meet previous conditions that were imposed for the financial support the post office received from the fiscus.”
Malatsi said one of the main goals is to help modernise the post office and its operations in order to drive innovation and competitiveness.
The portfolio committee on communications and digital technologies, said they welcomed the actions taken by Malatsi, however, they had reservations.
“The chairperson of the portfolio committee on communications and digital technologies, Khusela Sangoni Diko, notes and welcomes the statement issued by the Minister of Communications and Digital Technologies, Solly Malatsi, on actions being taken by the Department of Communications and Digital Technologies to save the Sapo.
“While the committee strongly believes that strategic and value-creating public-private partnerships are of critical importance to ensure a sustainable Post Office, it is, however, extremely concerning that Minister Malatsi’s statement seems to suggest a foregone conclusion that entering into such partnerships must equate to the ‘privatisation’ of the Post Office.
“In this regard, Minister Malatsi has said the pursuance of private financial and operational partners ‘will enable serious consideration of privatisation scenarios as a preferential option to further funding from the fiscus’.
“Sapo is a strategic state institution with an important mandate to connect people to one another and to the government in a fast-evolving technological age.
“As such, it must remain in the hands of the state, not beholden merely to commercial interests but committed to delivering on its universal services obligations espoused in the Postal Services Act of 1998,” the committee said.
Committee chairperson, Khusela Diko, said: “We support partnerships with the private sector to leverage resources, skills and market access, but that is not privatisation. It is strategic partnerships where risks are shared, not a scenario where the state carries the risks and capital monopolises the upside. That is an old model of public-private partnerships. We want to see clearly thought-out plans that build the capacity of state institutions whilst making Sapo commercially viable.”