Hon Chairperson, Ministers, Deputy Ministers and hon members of the House, it is with great pleasure that I introduce the South African Post Office SOC Ltd Bill to the National Assembly today. We are also fortunate in that this Bill is among the first of the Bills that make it clear in their title that it is a state-owned company, in alignment with the requirements of the new Companies Act.
This Bill signifies the government's commitment to ensuring that state assets benefit all South Africans. The commitment will only be achieved when state-owned entities like the Post Office are well managed and directed, leading to the overall development and economic growth of our country and the provision of more efficient services, particularly postal services, to our people.
The Bill before you is aimed at providing a comprehensive legal framework, addressing the corporate governance of the South African Post Office. While the governing of the Post Office was previously distributed between the outdated Post Office Act of 1958, its articles of association of the company and certain related documents, all of these will now be contained in a single modern piece of legislation, developed by this House and other secondary governance instruments like the Memorandum of Incorporation of the new Companies Act. It further makes a clear separation between the role of government as the shareholder and that of the board that carries the fiduciary duties entrusted to it to manage the Post Office efficiently.
With this Bill, we seek to strengthen the Post Office to enable the fulfilment of government's objectives and ensure the further development and growth of the postal sector as a whole. It also paves the way for an extension of the mandate of the Post Office beyond just postal services and situates the institutional infrastructure of the organisation in the new context of information and communications technology without the Post Office compromising its core business.
It is important to take into account the fundamental obligation that government has to ensure the universal provision of postal services. In the development of a dedicated Bill for the Post Office, we have endeavoured to ensure a smooth transition by retaining what was good in the old Post Office Act but improving the shortcomings where necessary. In particular, the fiduciary duties of the members of the board, for example, are comparable with some of the highest standards that can be required of board members.
Board members must be free of conflicts in all respects. A member may not have a direct or indirect interest that conflicts with the business of the company. A member must make a full disclosure of his or her financial interests to the Minister. Furthermore, a member of the board and his or her family members may not sell any goods or services or do any business with the Post Office.
It would be required that existing board members currently serving the Post Office must disclose their financial interests and divest themselves of any direct or indirect interests that are in conflict with the business of the company within a period of six months after the Act commences. This requirement has been extended to require that the Post Office must develop comparable requirements of all staff members of the organisation.
It is through good corporate governance that a well-functioning board can in fact ensure corporate success. Corporate success in turn means better services to our people. Corporate success leads to job creation and will ensure that money from the fiscus can be directed to other deserving causes.
Through excellent parliamentary oversight, it has come to light that many subsidiaries of state-owned enterprises are not really accounting optimally. This has led to the introduction in this Bill of additional measures in respect of the establishment of subsidiaries of the Post Office. Subsidiaries have also been made subject to the same governance requirements that the Post Office must adhere to. A performance management system will be introduced for both the Post Office and its subsidiary companies.
The consideration of this Bill was a dynamic deliberation process that also ensured its alignment with the Companies Act of 2008, which commenced during the deliberations. We believe that this Bill sets a precedent for other state-owned enterprises and for the protocol on good corporate governance in the public sector.
In recent years we have realised that governments must have a mechanism to intervene when state-owned entities fail. As separate legal and juristic persons, this has proven difficult at times, negatively impacting on service delivery and on the fiscus. This Bill is now introducing a mechanism that will allow the Minister to intervene in such matters. For example, the Minister can direct the Post Office to take certain specified actions if it is in financial difficulties, mismanaged or failing to perform its functions effectively or efficiently.
In conclusion, the legislation provides an effective legal framework for the functioning of the SA Post Office, guaranteeing the appropriate conditions for good corporate governance in its management and positioning the institution in the new digital era that is coming. [Applause.]