Telecommunications & postal services minister Siyabonga Cwele has admitted in parliament that the South Africa Post Office owes almost R245m to more than 2 000 suppliers and is in arrears of over six months on this money, the Democratic Alliance said on Wednesday.

The party accused the financially distressed Post Office of using its suppliers as a “second overdraft to float its negative cash flow”.

DA MP Cameron MacKenzie said a further 879 creditors remain unpaid for more than 60 days, with 1 804 unpaid for more than 30 days.

“This total amount owed to creditors for more than 30 days is unclear, but what is apparent is that this amount is much more than the organisation’s total current overdraft facilities at commercial banks, meaning that the Post Office cannot pay its current debts,” MacKenzie said.

“That Post Office creditors, many of which are small and medium sized enterprises, are used to render services, which then remain unpaid for, is unconscionable. Business owners and their employees depend on the timely payment of accounts for services rendered, and the Post Office’s failure to meet this obligation means smaller suppliers will simply go out of business,” he added.

“For a state-owned company to take advantage of its suppliers in an attempt to float its negative cash flow and to use its suppliers as what is effectively a second overdraft is irresponsible and morally and ethically reprehensible. In fact, for the Post Office to continue contracting services from suppliers with the full knowledge that it will be unable to meet its contracted payment terms is reckless trading.”

He claimed payment of Post Office employees’ salaries is also again in arrears, “specifically at the courier and freight group which includes XPS, PX, Speed Services and Docex”.

MacKenzie said Cwele needs to explain why Post Office board posts “remain empty and what steps are being taken to provide much-need leadership” at the company.