<\/p>\n
Parliamentarians on Wednesday expressed their unhappiness with the state the South African Post Office (SAPO) was in, with one even suggesting that the state-owned enterprise should just close shop.<\/p>\n
This is after the Office of the Auditor-General (A-G) briefed the Standing Committee on Public Accounts about SAPO\u2019s audit outcome for 2024\/25.<\/p>\n
The entity, which is under business rescue since, obtained for a third year in a row a disclaimer, which is the worst audit opinion.<\/p>\n
ANC MP Helen Neale-May said SAPO was a relevant institution to communities and South Africans, but it was allowed to disintegrate over the years.<\/p>\n
\u201cIt is very disheartening to see such an institution crumble before one\u2019s eyes,\u201d Neale-May said.<\/p>\n
ActionSA\u2019s Alan Beesley said the institution was not going to survive.<\/p>\n
\u201cIt is quite clear it is on life support and essentially the plug should be pulled. Looking at this report and outcomes, it is quite clear, it is not going to survive,\u201d Beesely said.<\/p>\n
Scopa heard that SAPO\u2019s audit outcomes remained stagnant for three years, and no opinion could be expressed due to the mess of its finances.<\/p>\n
Audit engagement manager Motshekga Makhai said the audit outcome was attributable to the institution\u2019s going concern status and failure to support strategies to turn around the business, and failure to provide supporting documents.<\/p>\n
\u201cThey did not have supporting documents to support line items,\u201d Makhai said.<\/p>\n
The audit found that the financial statements continued to be concerning, and the control environment was quite weak.<\/p>\n
Makhai said serious intervention was required for SAPO to produce credible financial statements.<\/p>\n
\u201cThe business rescue practitioners brought in consultants. This only resulted in a reduction of qualification areas, but the control environment remained the same. Because of the weak environment, some of the qualifications are repeated. It indicates that when there are action plans, they are not implemented or tracked accordingly.\u201d<\/p>\n
Makhai added that compliance with key legislations remained unchanged, and governance and oversight were areas of concern.<\/p>\n
\u201cThis was a regression in the current year. It was attributable to the fact that there was no board in place as it was dissolved,\u201d she said, adding that there was no company secretary and board committees were non-existent.<\/p>\n
The audit found that there was no consequence management for irregular, wasteful, or fruitless expenditure, and investigations were delayed.<\/p>\n
\u201cFor SAPO to deal with irregular expenditure, they need to ensure that staff understand how to deal with irregular expenditure well and understand the prescripts of law to deal with expenditure. The accounting authority to be appointed must deal with the remaining balance by ensuring there is proper consequence management,\u201d Makhai added.<\/p>\n
The audit also found that fruitless expenditure was significantly reduced due to the business rescue process.<\/p>\n
SAPO wrote off R136 million of the fruitless and wasteful expenditure, but it has yet to pay R16m to its creditors.<\/p>\n
Makhai told Scopa that SAPO achieved 13% of its targets and was way below in terms of its targets for building capacity and capability.<\/p>\n
\u201cThis means if you do not achieve the core mandate, you are unable to render the much-needed service to the citizens. This results in the loss of trust in the Post Office.\u201d<\/p>\n
Makhai stated that SAPO blamed its going concern status on its financial constraints.<\/p>\n
The entity was unable to collect revenue because the business was not doing well, and so serious is the situation that the revenue generated could not even cover the daily expenditure.<\/p>\n
SAPO\u2019s business rescue plan, which was adopted in December 2023, was based on the R6.2 billion commitment from the government.<\/p>\n
The entity received R2.4bn, while the R3.8bn is still outstanding.<\/p>\n
The committee heard that R86m was paid to the business rescue practitioners and consultants during the financial year under review.<\/p>\n
Makhai said SAPO\u2019s business modernisation and new business initiative strategies were yet to be implemented to assist in the turnaround and find ways to increase revenue, which is on continuous decline.<\/p>\n
ANC MP Ntando Maduna was concerned that SAPO was not achieving its strategic performance targets while receiving bailouts.<\/p>\n
\u201cIt is important that they show the will to change. If consultants have not worked, it is unfair to us to use taxpayers\u2019 money to bail out SAPO and pay consultants not assisting to improve internal controls,\u201d said Maduna.<\/p>\n
Scopa chairperson Songezo Zibi was concerned with whether the rescuing of SAPO was with the right strategy in mind.<\/p>\n
Zibi said there was a need for a policy rethink about the future of SAPO, which has a similar mandate with other banking institutions in government and also contended with explosion of courier companies.<\/p>\n
mayibongwe.maqhina@inl.co.za<\/p>\n","protected":false},"excerpt":{"rendered":"
Parliamentarians on Wednesday expressed their unhappiness with the state the South African Post Office (SAPO) was in, with one even suggesting that the state-owned enterprise should just close shop. This is after the Office of the Auditor-General (A-G) briefed the Standing Committee on Public Accounts about SAPO\u2019s audit outcome for 2024\/25. The entity, which is […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[18],"tags":[7816,1035,6636,7817,15428,417,18631],"class_list":["post-243010","post","type-post","status-publish","format-standard","category-politics","tag-audit","tag-disappointment","tag-express","tag-outcomes","tag-sapo039s","tag-scopa","tag-stagnant"],"yoast_head":"\n