Companies / 2 August 2019, 06:00am / Kabelo Khumalo
JOHANNESBURG – The resignations of chief executives of embattled state-owned entities (SOEs) ramped up on Thursday with South African Post Office (Sapo) boss Mark Barnes being the third head of an SOE to resign in as many months.
Charles Nwaila, Sapo board member, in a statement said Barnes had resigned due to difference in strategy.
“It is with regret that we announce that after three-and-a-half years at the helm of the SA Post Office, Mr Mark Barnes our group chief executive has tendered his resignation, citing differences on forward strategy in relation to the structure of the SA Post Office group, in particular the location of Postbank,” Nwaila said.
“Following discussions on Mr Barnes’ resignation with the board, the parties are in agreement on an amicable separation.” Nwaila did not take calls to explain what the differences over the “location of Postbank” were and Barnes did not respond to calls and questions sent to him.
In July 2016, the South African Reserve Bank approved Sapo’s first-level application for a banking licence for Postbank. Barnes was last year summoned by the then telecommunications ministry for allegedly dipping into the coffers of its subsidiary, Postbank, and transferring R200 million to Sapo to pay creditors.
According to Sapo’s corporate plan for 2018/19 to 2020/21, Sapo last made a profit in 2006 and was being kept afloat by government subsidies.
In this year’s Budget Review, the National Treasury allocated R1.9 billion to Sapo to help with its growing debt.
Thirty percent of Sapo’s revenue currently comes from Postbank.
The Minister of Communications and Digital Technologies, Stella Ndabeni-Abrahams, in a statement said that she noted Barnes’s resignation and that she appreciated his contributions to the company.
“His departure comes at a time when Sapo is charged with driving digital transformation in the postal sector.
"He played an integral role in strengthening the organisation and trust that our paths will cross again,” Ndabeni-Abrahams said.
Barnes’s resignation further highlighted the challenging climate of heading cash-burning SOEs without adequate support.
Former South African Airways (SAA) chief executive Vuyani Jarana in June resigned from the role, citing lack of government support in stabilising the entity.
In a scathing letter of resignation, Jarana said the lack of commitment to fund the national carrier was systematically undermining the airline’s turnaround strategy and making it near impossible to break-even by 2021.
Jarana’s resignation was followed by that of SAA board chairperson Johannes Magwaza in July.
The erstwhile chief executive of power producer Eskom, Phakamani Hadebe, in May resigned from the role and laid bare the toxic nature of what is arguably the toughest job in South Africa.
Hadebe, in a frank statement, said that the job to turn around the fortunes of the debt-laden power producer had had a negative impact on his health.
Eskom’s group treasurer, Andre Pillay, last month said he would leave the power producer at the end of this month, ending an eight-year career with the utility.