/ 6 November 2014

Minister delivers post office ultimatum

Siyabonga Cwele's bid to get things moving in the migration to digitally broadcast TV signals was stalled in the Cabinet.
Siyabonga Cwele's bid to get things moving in the migration to digitally broadcast TV signals was stalled in the Cabinet.

Siyabonga Cwele, the minister of telecommunications and postal ­services, has allegedly asked the board of the South African Post Office (Sapo) to resign. And if they didn’t quit, he would fire them, according to a senior board member who spoke to the Mail & Guardian on condition of anonymity.

But approached for comment on Thursday, Cwele’s spokesperson, Siya Qoza, said the minister had not asked the board to resign.

The post office strike is now in its third month. Communication Workers’ Union (CWU) president Clyde Mervin told the M&G that casual employees at Sapo had received emails and SMSes notifying them of their dismissal.

The senior board member said members of the board would ­formally hand over their resignations to Cwele on Friday November 7.

“An administrator has already been appointed to take over the board’s duties and he will also appoint a new board,” said the source.

Weak controls
The former post office board member in charge of procurement, Nobuhle Mthethwa, resigned last month. Mthethwa cited the board’s “lack of decisiveness, consequence management and agility” as reasons for her resignation.

She said the board’s weak controls and poor decision-making were partly to blame for the operational and financial ruin at the post office.

Business Day reported last year that Sapo’s board was sitting on a backlog of 33 tenders, a result of a new “procurement task team” appointed in 2012, composed of board members, who had interfered with tender processes.

The CWU’s Mervin said he welcomed the dissolution of the board.

“We want the whole executive management to be held accountable and we’re happy our voice has been heard,” Mervin said. In October, Mervin said, the union wanted Cwele to fire the board so that an arrangement to bail out Sapo could be reached with the treasury.

Financial distress
He said the post office had claimed to be in financial distress and operating at a loss, but salaries for management had increased whereas casual workers had not been paid.

“That’s why they had to go. If the minister accepts their [the board’s] resignations, Sapo can start on a clean slate,” he said.

Last Friday Sapo submitted its financial statements to the parliamentary communications portfolio committee, which showed that expenses outstripped revenue. Sapo posted an unaudited net loss of more than R359-million for the current financial year.

The state entity also declared a procurement breakdown of irregular expenditure of R2.1-billion. Sapo’s supply chain management unit had reviewed the lists of procurement contracts and identified expired contracts that were still in use and that some stock items had been procured without formal contracts. During her presentation to the parliamentary communications portfolio ­committee last Friday, Sapo chief financial officer Khumo Mzozoyana said the annual financial statements for March 31 2014 had not been finalised and “engagements” were taking place with the ministry of telecommunications and postal services and with the treasury.

According to the Democratic Alliance’s Cameron MacKenzie, a member of the communications portfolio committee, Sapo was the only state entity that failed to submit audited financial statements this year. He said the auditor general had refused to sign the financial statements submitted by Sapo.

“There were disagreements as to whether some items should be classified as irregular expenditure or fraud and wasteful expenditure.[But] why would any CFO [chief financial officer] present financial statements that were not audited? Heads are going to roll [at Sapo]. We expect the minister to fire the board.”