With scores of post offices already closed because of failure to pay rent, car rental companies are now withdrawing their fleets from Sapo because of money owed.
Barloworld Automotive chief executive Keith Rankin confirmed that Avis Fleet had taken back 179 vehicles in KwaZulu-Natal and the Free State after they lost the contract.
He said Avis Fleet started taking 30 of their 132 vehicles as from July 13 due to the units being over contract term and due to payment issues.
“Based on a promised future payment it was agreed, on Wednesday, with Sapo that we will stop vehicle collections.
“We have collected about 30 vehicles of the 132 units,” said Rankin.
He wouldn’t reveal how much was owed to Avis Fleet by Sapo.
Communication Workers Union general secretary Aubrey Tshabalala said Sapo was slowly collapsing and in need of an urgent cash injection from the government.
He said Sapo was experiencing multiple issues which included corruption, mismanagement and financial difficulties since 2007.
“The state of affairs at (Sapo) have been deteriorating for some time, with slow response from the government,” he said.
Earlier this month, Sapo workers embarked on a three-week-long strike demanding a 6.5% increase, backdated to April 1.
They also demanded that contracted working hours for permanent part-time employees, be increased from 21.5 hours per week to 27.5 hours per week.
Tshabalala said the situation at Sapo was in dire need of the government, specifically the National Treasury’s, attention.
“They are closing a number of depots, fleets are taken away due to non-payment.
“While we want to revive Sapo we can’t talk about it without recapitalisation from Treasury.
“We need to revamp the entire Sapo in a nutshell,” he said.
Sapo confirmed that it was “experiencing some liquidity issues” and was managing this with its suppliers.
“Our labour situation has been stabilised and remaining issues are being dealt with in conjunction with the Department of Posts and Telecommunications.
“The current vehicles rented from Avis will not be withdrawn and the contract with them is being renegotiated,” said Sapo.
Sapo said despite its money struggles it could carry out social grant distributions to beneficiaries.
“Like all government-owned entities, (Sapo) has the duty to manage its cash flow extremely carefully.
“However, the administration of the Sassa grant payments is managed and financed separately from (Sapo’s) other business activities and the service rendered to Sassa and its beneficiaries remains top priority,” said Sapo.
DA post and telecoms spokesperson Cameron MacKenzie said Sapo was losing millions of rand a month.