Chairman of the Economic Committee David Bitan, from the Likud party, threatened to dismantle the postal service recovery plan, claiming that the closing of branches and reduction of operation hours harms the level of service for populations in the social and geographical periphery. In a discussion held last Monday in the Economic Committee, Bitan said that he is concerned about what is happening in terms of public service in the mail, and that if a public mailing service is a priority, then the Finance Ministry must dip into its coffers.
According to him, it is impossible to maintain the universal postal service on an economic basis. Therefore, additional funding must be allocated to the company from the state treasury or at the expense of the commercial banks, in order to preserve the postal bank services.
The Minister of Communications, MK Shlomo Karai (Likud), participated in the beginning of the debate, and noted that there is a significant decrease in the consumption of postal services. He added that he intends to ensure that the service to the public will not be harmed and will even miraculously improve. Bitan asked the committee's legal advisor to review the drafting of a bill that would require the commercial banks to finance the postal bank services, and told the minister that he would help him in this matter.
The CEO of the Ministry of Communications, Liran Avisher Ben Horin, updated that she hopes that in April-May it will be possible to start the procedure for the sale of the mail system, and promised that if the privatization is successful, we will see an efficient operation of the company. She also stated that the minister should sign the new postal license in the coming week, which includes significant concessions for the Israel Post, both commercially and in terms of the layout of the branches. Chairman Bitan said in response: "On the slides it always looks good, but on the ground the situation is problematic."
The postal recovery plan may damage public service
The chairman of the Israel Postal Company, Michael Vaknin, commented on the employee retirement plan: "They are not among the top earners in the public service. We have already released about 700 employees, 60 in early retirement and 40% in layoffs. Those who retired left with a very low pension. Some left with 5,000 or 5,500 shekels in retirement, the program will reach 1,100 employees."
Vaknin admitted that the post office's recovery plan is based on damage to the level of service afforded to the public. According to him, "We are reducing the level of service because there is no money, and also because we don't need it – people use postal services less."
"If the license change is not carried out, the whole program will collapse and we will return to a state of insolvency, which means a delay in the payment of salaries, and even more serious harm to the public. It is better to have a service that is reduced than one that doesn't exist at all."
Vaknin explained that "in the past year, 70 branches were closed, and we intend to close up to about 100 branches, and to stand at about 350 branches and between 600-700 delivery points for packages." Chairman Bitan responded that this is a plan to eliminate the mail as a service in Israel, and said "then according to this, the mail will become a museum exhibit."
"The hours of service have decreased,” Vaknin continued. “The level of service needs to be lowered, so that the company can meet its commitment, and respond to the decreasing demand. Every year we meet, you will see that this trend only continues. Every year there will be another 5-10% drop."
Ran Melamed, head of the nonprofit Turning Point: the Center for Promoting Economic Well Being, also spoke out against the privatization, claiming that "the post office is not working properly.”
“I am disabled. When I use public transport or travel by foot, it is very difficult for me,” he said. “My post office in the Katamon neighborhood in Jerusalem has been closed, a branch that served an elderly population." According to him, the alternative branches are not accessible to public transportation or the disabled, including some of the package drop-off points.
"I complained in writing to the CEO, the former Minister of Communications, the mayor of my city. They all answered me saying, ‘there's nothing we can do, it's the privatization'," Melamed said.
The mail is state-run in Europe – so why not Israel?
During the debate, Vaknin expressed his opinion against government support for postal services. According to him, "there are more important things than spending 300 million shekels from the state on the post."
Bitan asked if postal services are supported in European countries. The director general of the post office, David Laron, replied that "of course it is, all countries have a postal system. In all countries there is a decrease in the amount of letters, and there is a social periphery that depends on the services.”
Bitan was not convinced and demanded to know how the loss-making postal services in the periphery would be financed. Ben Horin said,"We have come up with a reasonable solution given the scope of the demands,” but Bitan was not satisfied with this statement.
He responded: "I hear the complaints. Probably for you, it is related to money. You run a company, I am responsible for the public. The mail should be sold to someone, but I'm telling you, the mail is a national resource, it should reach the people. In the end, everything will be online and the story is over. In 20 years there will be no mail. In the meantime, this service should be provided. You see everything through money. Public service – have you heard of it?"
Bitan accused the Ministry of Communications of surrendering to the Ministry of Finance: "We will not give up on this matter. The Ministry of Communications should also take care of the service, and not just privatization so that the Treasury will be satisfied. I hear the complaints and you see everything through the money. If you and the Treasury do not want the banks to finance it then the Treasury will finance it. With all due respect to the reform, we will not allow service for the elderly to be harmed."
Bitan demanded the Ministry of Communications to present a plan to preserve the level of the postal services in the social periphery within the next 30 days.
The Israel Post responded: "Israel Post is everywhere, and the company's business plan is based on financing the loss-making activity that we are obligated to operate. The company will reach operational balance already this year, but without privatization we will not reach growth because we will not be able to invest in technology and mechanization."
This article was translated from Hebrew by Nancye Kochen.
