The SA Post Office (SAPO) will issue tenders to the value of R249 million, before the end of the financial year in March 2011, to upgrade its IT network infrastructure, it told Parliament yesterday.
SAPO CFO Nick Buick said he hopes the tenders would be issued and awarded, and are part of the state-owned entity's plans to diversify its business streams in the face of difficult economic times.
“Mail volumes have a direct link with growth in GDP [gross domestic product]. However, that trend has changed as clients start using more and more electronic means to deliver mail.”
Buick also noted that IT now makes up 52% of the Post Office's annual capital expenditure of R500 million. This is funded from its own revenue, he explained, while the R302 million subsidy it receives from government is used to meet its social and developmental obligations, such as establishing outlets in rural areas.
The government subsidy is due to decline to around R52 million in the medium-term expenditure framework period of the next three years.
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