Pipped at the Post: How the government tried to sell Australia Post

Apr 23, 2021

Parliamentary privilege is far more than a means of protecting politicians from being sued for what they say in parliamentary proceedings. It is a powerful tool for any Australian seeking to hold governments to account. By giving evidence under privilege to a Senate committee, former Australia Post CEO Christine Holgate was able to expose the Morrison Government’s plan to cut postal services and privatise parcel deliveries.

As CEO, Ms Holgate had resisted that plan, and her decision to give $5000 Cartier watches as bonuses to four executives gave the government a convenient pretext to stand her down.

Ms Holgate supplied the Senate committee with copies of a secret review of Australia Post by the Boston Consulting Group (BCG).

The BCG review, commissioned by the Government, includes proposals for the closure of up to 213 post offices and the loss of nearly 8000 jobs, leading to a reduction in services and sale of the parcel delivery business.

All of this would have happened on top of the reduced letter delivery service introduced in response to the Covid-19 pandemic.

Communications Minister Paul Fletcher has responded to the revelations at last week’s Senate committee hearing by saying that the Government has no plans to privatise Australia Post.

Well, he would, wouldn’t he? The minister’s “nothing to see here” statement really says no more than the government has no plan until there is an official, public scheme to privatise.

Despite Mr Fletcher’s claims, a letter that he and Australia Post’s other shareholder minister, then Finance Minister Mathias Cormann, sent to the corporation’s board and management on 30 March 2020, says otherwise:

“We thank you for your assistance during the review and look forward to continuing to work closely with the board and Australia Post as you manage the effects of Covid-19 on your workforce, your customers and the business, and through the upcoming corporate plan process. As an initial step, we envisage that BCG’s finding should be taken into account as the corporate plan process is developed as we work together to support Australia Post’s ambition for transformation”.

The ministers gave themselves wriggle room. The letter does not contain a formal directive to implement the BCG proposals but makes clear that the BCG review should be used to guide Australia Post’s next strategic plan.

Ms Holgate, however, pushed back against the BCG proposals. She advocated an alternative strategy of growing Australia Post’s letter and parcel delivery business while also introducing new services, including financial services.

That made her a problem to be solved, and the Cartier watches presented the Government with an opportunity to solve the problem.

When the Prime Minister was asked about the watches during question time in November last year, he condemned the gifts as scandalous and insisted that Ms Holgate should step aside pending the outcome of an inquiry. If she did not, “she should go”.

The subsequent inquiry did not find any major fault in Ms Holgate’s actions, because it was within her remit to award bonuses of up to $150,000 to executives.

As we know, however, she eventually submitted her resignation to the Australia Post board. She believed the campaign of vilification to which she had been subjected made her position untenable, although she claims her contract is yet to be concluded.

The Government got what it wanted through a shabby exercise in the politics of distraction. Even Ms Holgate concedes, as she did in evidence to the Senate committee, that in retrospect the decision to give the watches to the four executives was unwise.

No doubt that is so, but it should be noted that the watches were not just perks. They were presented as bonuses because the executives had negotiated a deal to make banking services available through Australia Post offices.

As Ms Holgate noted in documents presented to the Senate inquiry, “Over 50 per cent of the communities in Australia do not have a bank, yet there is a post office. An extended role in financial services would help keep community post offices sustainable while providing a very important community service”.

For the present, the plan to privatise part, and perhaps eventually all, of Australia Post appears to have been shelved.

The Government has retreated in the face of the revelations of the Senate inquiry, which showed the campaign of vilification directed against Ms Holgate for what it really is: the bullying of a successful female CEO who did not bow to an ideological agenda that would hurt the most vulnerable in our community.

But we now have confirmation of what the Government’s intentions were. If they are to be resisted again in future, we are likely to need the Senate’s committee process to again hold the Government to account.

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