South Africa: Post Office Board On Annual General Meeting

press release

The annual general meeting of the Board of the SA Post Office was concluded on 31 March 2021, with the Board and Minister reviewing the achievements, challenges and risks of the 2019/2020 financial year.

The Post Office plays a pivotal role in the fabric of South African society, the Board noted. 8,1 million SASSA beneficiaries were paid monthly through Post Office-Postbank system. These beneficiaries can access their grants at designated post offices, ATMs or supermarkets. Therefore, payment of these grants is not tied to a physical post office.

"The Post Office delivered 2,6 million schoolbooks to 3,873 schools in Limpopo and the Northern Cape and more than 8000 laptops to the Universities of Pretoria and Johannesburg without a glitch," said acting Chairperson Tia van der Sandt. "We hope to expand this service to other provinces as well, thereby keeping money within the fiscus and reducing the pressure on the state coffers."

The Post Office continues to allocate addresses to citizens in rural areas and informal settlements. An address is essential for an economic identity and for opening any account. A total of 637 094 new street addresses were rolled out during the year.

South Africa is on course to continue with the migration to digital broadcasting this year, and 1 151 194 qualifying households were registered through the Post Office for the subsidised set-top box needed for uninterrupted watching of television after the change to digital transmissions. The digital migration programme is critical for government to be implemented by March 2022.

Despite challenging trading conditions, revenue performed below target by 8%. The entity received recapitalisation funding of R2.947bn on 25 January 2019 which was utilised to settle term loans of R1.035 billion and pay outstanding creditors.

The Post Office took steps to address its cost base by embarking on initiatives of staff reduction, achieved through natural attrition and voluntary severance packages. Staff numbers dropped by 1 871 during the year under review.

The entity reduced energy cost by 17% and recycled 54 tons of paper.

Revenue from motor vehicle licences improved by R23,9m. This service is now offered at selected post offices in all provinces except the Western Cape, and is offered at no extra cost to vehicle owners.

The delivery performance of mail items stood at 89,25%, an improvement of 12.85 percentage points from the prior year. Approximately 535 million items were delivered during the year. It should be noted that mail delivery was not possible during the lockdown period, and the Post Office has cleared the backlog from this period.

The downside is that the payment of social grants made post offices more attractive as targets for criminals, and to address this, security features at branches were, and continue to be improved.

Van der Sandt says to ensure the relevance of the Post Office in a competitive market, the Board has set out to oversee the development and implementation of projects that ensure the Post Office retains relevance and growth in the ever-changing economic landscape.

The SASSA project gave the Post Office access to technologies which includes access to the Home Affairs database and fingerprint readers. This opens the possibility to offer more services in cooperation with other government entities, such as renewal applications for driver's licences, identity books and passports.

The financial year under review was marked by the unbundling of Postbank from the Post Office and support for its establishment as a separate entity. This proved to be a protracted process which delayed the conclusion of the annual results.

The Auditor-General noted in the audit revaiew that Postbank was separated from the Post Office without compensation, which had a negative effect on the Post Office's balance sheet.

The Post Office Board is committed to enforcing and demanding a productive and professional work ethic - a requirement that was emphasised by the Minister Stella Ndabeni-Abrahams.

The appointment of a permanent CEO is a vital stabilising factor for the Post Office and the Board welcomed Ms Nomkhita Mona joining the entity. The Board has prioritised the appointment of a permanent CFO.

In response to a marked reduction in Post Office revenue after the Covid-19 lockdown, the Minister will provide the Post Office with turnaround experts who are expected to start their work in the immediate future.

The Board committed itself to providing a remedial action plan for shortcomings within the Post Office. The Board will report to the Minister monthly against the remedial plan, and as is normal business practice,

It is essential to introduce new revenue streams to the Post Office as part of a turnaround plan, and the Board intends that this must be done as soon as possible.

In this regard the Board of the Post Office expressed its appreciation to the Honourable Minister Ms Stella Ndabeni-Abrahams and the Honourable Deputy Minister Ms Pinky Kekana, as well as the Department of Communications and Digital Technologies, for their support and guidance. The Board also expressed its gratitude to the valued guidance and direction provided by the Portfolio Committee.

The Board also wishes to thank all the valued customers and employees of the Post Office, and the media, for the support provided during these challenging times. The Post Office can only improve through this partnership.

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