Malawi Post Corporation needs to downsize its staff if government is to recapitalize for its reform strategy

Inactive post offices contribute to loss making

* Over 500 employees out of over 800 are redundant due to decline in mail volumes by 95% from year 2000 to 2020

* This is in the midst of staff demanding 40% salary increment

By Duncan Mlanjira

Malawi Postal Corporation (MPC) has disclosed that it is deep in debt of over MK9.3 billion that is compromising its operations and for it to remain afloat, it needs to be recapitalized by government as the initial stage of turning around.

One of the measures is for the statutory corporation to downsize its staff compliment from 806 to around 310.

This was disclosed by acting Postmaster General, Zachaeus George Meke and MPC chairperson Noel Mkulichi during an interface with the Parliamentary Committee on Information and Technology on Tuesday where they said one of their reform area is to do with cost reduction.

Mkulichi told Malawi Broadcasting Corporation (MBC) after the meeting that MPC needs to reduce numbers as they have excess staff in the postal service that do not have appropriate qualifications and “need to pay them off in order to restart on good footing”.

He said a functional review done by their human resources department — in liaison with the Office of the President and Cabinet — came up with a staff figure of around 310 if MPC is to remain afloat.

MPC was established in the year 2000 and has over 180 post offices across the country, of which 60 are economically viable while 120 are just running as social services generating as little as MK5,000 in three months while others general nothing per month.

In a separate interview, Meke hinted that the corporation’s staff costs stood at 110% of revenues during the 2019/2020 — signaling that the corporation could not raise enough for salaries.

Mkulichi hinted the need to urgently downsize so that the corporation could remain afloat.

Meanwhile, staff at MPC threaten to strike from Friday June 4 to, among others, force government to fund MPC.

A memo that Maravi Express  has seen from MPC Union president Mr. Chipoka, indicates that staff will go on strike to force management grant them 40% salary increment, pay pension arrears that dates back to 2019 and pay them salaries on time.

It has been brought to our attention that MPC started struggling from year 2000 when it was established after the split of MPTC, which is mainly due to an upsurge in communication technologies.

It is also established that MPC was supposed to be given yearly funding to support the loss making post offices which only came 5 times in its 21 year history leaving out 16 years in unsupported service.

MPC was established to operate postal, financial and other related services. The parastatal used to own Malawi Savings Bank that was delinked from MPC thereby exacerbating its financial position.

Maravi Express can also reveal that many of the MPC’s staff that joined in the 90s and early 2000’s joined without any formal recruitment procedures and qualifications.

On the 40% salary increment, Meke hinted that at current capacity and staff compliment, this wasn’t feasible. He indicated that commitments were there to reduce the pension arrears by end June.

He further hinted that the 40% increment was only possible after rightsizing —  taking cognizance that MPC “is the lowest paying parastatal” and needs to set up competitive salary structure “which will inspire the remaining staff to work harder in order for the Corporation to start making profits” and also to be able to attract skill set for transformation.

In his remarks, chairperson of the Parliamentary Committee on Information and Technology, Abu Naliwa said they will take MPC’s issue into the august House for deliberation in the K1.9 trillion 2021-2022 national budget that was presented by Finance Minister, Felix Mlusu.

Meanwhile, Meke recently told the media that MPC has set up a turnaround strategy aimed at transforming MPC into a digitally driven organisation. Some if the developments include digitally driven courier, system based ticketing for the bus, introduce e-commerce platform, virtual Post Office, Post Bank among others.

Meke hinted that the future of MPC is in digital services and in courier and logistics.

“We are reshaping MPC from being a socially service provider to become a commercially driven business organisation that also target the rural masses to fully profit from,” he said.

In the exclusive interview, Meke also disclosed of plans to operate as a third party financial service provider (aggregator) as well as digitally restructuring their courier service so that customers can track the goods they have sent from point of sending till its destination.

“We are geared to clear the rubble that was created from fundamental errors that established MPC. He also hinted on plans to refurbish and modernise the Postal Network in a bid to create the modern ambiance for the benefit of Malawians in both rural and urban set up.

MPC has an intercity passenger coach services fleet that complements its national courier service and plans are underway to introduce plush city bus services which the country had in the past.