Post Office reassures Sassa beneficiaries they will be paid despite financial woes

The payment of social grants will not be affected by the financial woes of the SA Post Office, the parastatal has vowed.

This despite the Post Office approaching subsidiary Postbank for R1 billion to enable it to process social grants.

In a statement, the SA Post Office has assured Sassa beneficiaries that “the payment of social grants will continue as normal and will not be affected by the current financial restraints experienced by the Post Office.”

By the end of May, the Post Office had recorded an estimated R800 million loss in revenue due to the national lockdown. In a parliamentary briefing, the management and board of the Post Office estimated the parastatal could experience more than R1.9 billion in losses for the year.

The Post Office has since requested additional financial support of R4.9 billion and Treasury has described it as being in “dire need of restructuring and repurposing” to avoid collapse.

“The SA Post Office experienced a dramatic reduction in revenue during the lockdown period and is currently looking at ways to improve cash flows,” the statement continued.

However, this will not affect Sassa beneficiaries as the funds for social grants come from National Treasury through the Department of Social Development and are not sourced from the Post Office, the statement read.

On Sunday, City Press reported the Post Office had approached its own subsidiary, Postbank, for R1 billion to enable it to process social grants ahead of next week’s payments.

When the Post Office took over from Net1’s Cash Paymaster Services as the primary distributor of social grants, Postbank pre-funded the payments and was reimbursed four days later. This was to prevent the money being paid ahead of time, banked and the interest earned kept by Net1.

Since the corporate separation of Postbank and the Post Office, the parastatal has relied on its own reserves for pre-funding – something that is no longer possible with the Post Office’s “reserves depleted”.

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