Postal corporation is being killed

I pity the 3,000 employees of the Postal Corporation of Kenya (PCK) who have not been paid a salary for the last five months. How on earth do we expect a salaried worker to survive without an income?

For the city dwellers, migrating the family to the rural areas is not a realistic option because their ageing parents don’t have the wherewithal to look after children used to an urban environment.

Employees of this former gigantic corporation have been made to endure untold misery. But why is PCK in dire financial straits? The answers given by management — and, indeed, the government — are all too familiar.

First, PCK is dire financial straits due to the impact of Covid-19. Secondly, its problems began when it lost its monopoly, forcing it to face too many nimbler and lower-cost competitors. Third, PCK should have been privatised and sold off to private sector players a long time ago.

Broken business model

Fourth, PCK persists in following a broken business model that puts emphasis on mail services despite the fact that this has been disrupted by the internet. Fifth, the postal service faces a crisis of obsolescence.

Let them tell all that to the birds.

In my view, PCK’s predicament is just but one example of lack of foresight by the government: It has failed to navigate this provider of critical infrastructure to institutions through technological disruption.

When you look at the rest of the world, how many postal corporations are still State-owned? Very many. How many of them have lost their monopoly status? Several. How many have survived technological disruption by the internet? Many.

So, what have other countries done that we have not? When we dismantled Kenya Posts and Telecommunications Corporation (KP&TC) to create PCK in 1998, our government did not come out with a clear strategy of guiding this critical corporation through changes in technology.

Make profound alterations

We needed to make profound alterations to the business model and think through how to invest proper money in expanding its product portfolio beyond mail and the post office box.

As our government slept on the job, other countries were rebuilding profitable mail businesses to enable them raise the money to invest in new platforms — like full-scale e-commerce offerings, full-fledged banking services, air cargo and freight business, besides providing government services.

In other countries, postal corporations have diversified through mergers and acquisitions. Here, the government has failed to achieve something as simple as merging the operations of PCK and Post Bank to create one entity. The South African Post Office Bank ranks among the top 10 credit institutions in that country.

This week, I fished out a letter from my archives where the former postmaster-general, Mohammed Hussein Ali, wrote to the National Treasury proposing that PCK be merged with the Government Coast Agency, a department under the Ministry of Finance responsible for clearing the government’s imports.

A former military general who was appointed police commissioner before he became postmaster-general, Mr Ali took up office notwithstanding the fact that he did not possess deep domain knowledge and experience in running a post office.

Anyway, appointment of CEOs and directors of PCK is an arbitrary affair.

I don’t know what became of the suggestion by Major-General (Rtd) Ali.

Huduma centres

I maintain that the Huduma centres should have been given to PCK to run through its wide network.

Today, many postal services in the rest of world do a lot of government services. I was surprised when I read that State-owned Australia Post provides quite a wide range of government services, including issuance of driving licences, the national ID and even passports.

What explains the insensitivity by the government to the plight of PCK and the 3,000 citizens on its workforce?

I have a theory. The political elite have all along wanted PCK to die so they could grab its land. Indeed, the corporation used to be one of the biggest property owners in the country, with land and buildings literally in every urban area.

From my archives, I find gazette notice number 156 of June 1999 by the minister for Finance, headlined: “Transfer and vesting of assets of the Kenya Postal Corporation”. If you want to appreciate the extent of land belonging to the corporation that has been grabbed, this is the place to start.

I’ve also seen several letters by successive postmasters-general to both the Ethics and Anti-Corruption Commission (EACC) and the Ministry of Lands seeking assistance in their efforts to recover PCK land that has been grabbed by influential individuals.

Benign neglect and exploits of corrupt elites — not technological disruption — are the reasons why PCK is insolvent today.

[email protected].