[South Africa] R19 billion Post Office losses and long list of creditors

The business rescue plan for the South African Post Office (Sapo), published at the end of November revealed that the state-owned company owed nearly R9 billion to creditors, The Citizen reports.

Accumulated losses had reached R19 billion by the end of September and Sapo has reported losses for the last 16 years. 

Equity has reportedly been completely wiped out while assets at the end of March barely reached R4.4 billion.

The largest chunk of the R9 billion is R4.6 billion owed to Postbank. It officially separated from Sapo in September.

The long list of creditors holds the details of 1,100 and is 14 pages long.

Sapo reportedly owes a combined R400 million in unpaid rent and contributions to the group’s retirement fund and various medical schemes have not been paid.

It owes the Post Office Retirement Fund R1.22 billion and Medipos Medical Scheme a further R693 million. In addition, R25 million is owed to to Sizwe Hosmed Medical Scheme, R18 million to Bonitas Medical Fund and R9 million to Discovery Health Medical Scheme.

The contributions impact current and former employees directly. 

Of the largest 15 creditors - disregarding Postbank, the Post Office Retirement Fund and two medical schemes (including its own, Medipos) - seven creditors are government entities or state-owned enterprises.

Coming top is the South African Revenue Service (Sars). The Post Office owes Sars R697.7 million. Much of this is reportedly PAYE tax.

In 2021, an article in the Daily Maverick exploring the issue said, “Put differently, the Post Office continues to pay its workers their full salaries and probably deducts their PAYE contributions – but doesn’t hand over the deductions to Sars.”

Sapo also failed to make contributions to the Unemployment Insurance Fund (UIF).

The business rescue plan will reportedly see as many as 6,000 of around 11,000 employees being retrenched while the number of branches needs to be halved to 600.

Concurrent creditors will receive 12 cents in the rand, under the plan, with statutory and payroll creditors receiving an additional 18 cents.

Source: The Citizen

(Quote via original reporting)

The business rescue plan for the South African Post Office (Sapo), published at the end of November revealed that the state-owned company owed nearly R9 billion to creditors, The Citizen reports.

Accumulated losses had reached R19 billion by the end of September and Sapo has reported losses for the last 16 years. 

Equity has reportedly been completely wiped out while assets at the end of March barely reached R4.4 billion.

The largest chunk of the R9 billion is R4.6 billion owed to Postbank. It officially separated from Sapo in September.

The long list of creditors holds the details of 1,100 and is 14 pages long.

Sapo reportedly owes a combined R400 million in unpaid rent and contributions to the group’s retirement fund and various medical schemes have not been paid.

It owes the Post Office Retirement Fund R1.22 billion and Medipos Medical Scheme a further R693 million. In addition, R25 million is owed to to Sizwe Hosmed Medical Scheme, R18 million to Bonitas Medical Fund and R9 million to Discovery Health Medical Scheme.

The contributions impact current and former employees directly. 

Of the largest 15 creditors - disregarding Postbank, the Post Office Retirement Fund and two medical schemes (including its own, Medipos) - seven creditors are government entities or state-owned enterprises.

Coming top is the South African Revenue Service (Sars). The Post Office owes Sars R697.7 million. Much of this is reportedly PAYE tax.

In 2021, an article in the Daily Maverick exploring the issue said, “Put differently, the Post Office continues to pay its workers their full salaries and probably deducts their PAYE contributions – but doesn’t hand over the deductions to Sars.”

Sapo also failed to make contributions to the Unemployment Insurance Fund (UIF).

The business rescue plan will reportedly see as many as 6,000 of around 11,000 employees being retrenched while the number of branches needs to be halved to 600.

Concurrent creditors will receive 12 cents in the rand, under the plan, with statutory and payroll creditors receiving an additional 18 cents.

Source: The Citizen

(Quote via original reporting)