1,200 face early retirement as Posta seeks to cut wage bill

Nearly 1,200 Postal Corporation of Kenya (PCK) employees could be sent home on early retirement if recommendations made in a report expected to guide the turnaround of the State agency are implemented.

A taskforce mandated by the ICT ministry to draw a turnaround plan for Posta yesterday recommended a staff audit to shave the corporation’s wage bill and ensure that employees are equipped with technological skills.

Posta spends Sh1.7 billion on annual wages for its 3,200 employees, which takes up 65 per cent of its revenue.

“I think you all know that PCK is bloated. The workforce is too high, much more than they need and they can manage,” said Ms Mary Basweti who chaired the PCK taskforce.

An estimated 40 per cent of Posta employees are aged 55 years and above, while about 640 (20 per cent) are set to retire by next year.

Many of these have reportedly expressed the desire to go on voluntary retirement.

Terminal benefits

However, the cash-strapped agency will likely need financial support to pay terminal benefits.

“There are people who want to go… They have to be let go in a systematic way. They need to leave and they want to leave, but we need to assist them,” said Ms Basweti.

She was providing highlights of the taskforce’s report, which was handed over to the ministry for review.

Among others the report also recommends that government offices should be required to use Posta services.

A survey by the Communications Authority (CA) recently found that public offices opt for private courier firms or even picking up their goods themselves rather than using Posta.

Amendments have also been suggested to the Postal Corporation Act, which requires Posta to provide universal access, meaning that the bottom line is not as much a concern as ensuring that every Kenyan can use postal services.

Rarely used

This mandate has seen Posta spending most of its revenue to maintain rarely used infrastructure.

Fibre infrastructure should be extended to all postal outlets in line with a strategy to ensure that the corporation is more technologically savvy.

Posta has been turning more strongly to technological solutions, having introduced a mobile-phone linked postal box service last year. It is also betting big on e-commerce.

Posta has been suffering the effects of technological modernisation that have seen Kenyans opt to send emails rather than letters. 

At the same time, a thriving private courier business has proven more nimble and attractive to consumers than Posta with its legacy of lethargic bureaucracy.

The 2015/2016 financial year was the worst on record for Posta as the firm recorded a Sh1.5 billion loss though revenues stood at Sh2.67 billion.