11 October 2023
South African Post Office CEO Nomkhita Mona had a hard time in Parliament on Wednesday. Screen capture via livestream
Member of Parliament Natasha Mazzone (DA) told the leadership of the South African Post Office (SAPO) that the Auditor-General’s report on the post office was one of the worst she has seen.
Mazzone was addressing a meeting of the Portfolio Committee on Communications and Digital Technologies on Wednesday.
SAPO and Postbank representatives presented their 2022/23 annual and financial reports at the meeting.
The Auditor-General’s report on SAPO raised concerns about company assets, SAPO’s ability to pay debts, lack of support for social grant transactions, accounting inefficiencies, supply chain management and more.
SAPO CEO Nomkhita Mona attributed the downfall of SAPO, which hasn’t made a profit since 2006, to several reasons. These included payment of social relief of distress grants which caused “untold damage to the business of SAPO,” Covid, the separation of Postbank, cash-and-carry robberies, among others.
She said since 2021, 488 employees had been dismissed, with 203 of those dismissals related to fraud or theft. 188 of those dismissals occurred this financial year, she said.
SAPO had a total loss of R2.2-billion in the latest financial year, she said.
Mona said the organisation had a turnaround strategy, but Mazzone was sceptical.
Mazzone said she is regularly phoned by workers who are stranded because they visit a post office to collect money and it is closed or has run out of cash.
SAPO is under business rescue. Committee member Lesiba Molala (ANC) questioned why the committee could not hear from the business rescue practitioners on progress.
“The South African public wants to know,” he said.
Department of Communications and Digital Technologies Deputy Director Omega Shelembe responded that the Business Rescue Plan report is expected in November.
In Postbank’s report, CEO Nikki Mbengashe said the bank has a performance rating of 21% for achieving its goals of:
“I don’t see a clear way forward. What I see is yet another failed entity,” Mazzone said about this failure to meet goals. “This has a financial impact that could dramatically affect the lives of the most vulnerable South Africans.”
Mbengashe also told the committee that Postbank currently has ten million active customers, although it is losing them. It is not currently allowed to take on new customers due to a variation notice. (This is a notice issued by the Reserve Bank to PostBank indicating irregularities.)
She added that Postbank loses over R35-million per month because of the SAPO/SASSA contract that was ceded to Postbank in October 2022. “If this operating model is corrected, this could change,” she said.
Molala presented concerns about the Postbank’s disciplinary numbers. Mbengashe reported Postbank has dismissed five employees, held six disciplinary processes and suspended two employees. Four employees have voluntarily resigned.
But Molala said Postbank presentations since 2021 had indicated about R86-million lost in fraud. He questioned how only five employees had been implicated.
Mbengashe responded that investigations are continuing.