After weeks of negotiations: The Ministries of Communications and Finance reached an agreement today (Thursday) with the Postal Administration and the workers’ representatives, ahead of the complete privatization of the Israel Postal Company.
The parties’ agreements include a plan to streamline and reduce wage costs, accelerate the transition to digital services, deliver packages with high accessibility, a dedicated service for older populations, re-retirement of postal services, and promote competitive conditions in the postal market.
The company’s employees were involved in the complex process of rehabilitating the company and privatizing it out of concern for the company’s future, while the Israeli government ensured fair retirement conditions for retiring employees and business certainty for the remaining employees in the company.
These are the main outlines agreed upon by the parties:
Public service:
• Full transition of postal services to digital within 18 months
• Improving the service in the package market – the customer will be able to choose the point of collection for delivery from abroad in 85% of all deliveries
• Establishment of a ‘package to the house’ system in which packages, letters and registered mail will be collected from adult homes
• Ensuring nationwide deployment of parcel delivery centers with an emphasis on peripheral areas
• Recharge allowances on the card (DEBIT) without the need to arrive at the branch.
Privatization and recovery:
• Full privatization in two stages in order to realize the company’s business potential
• Retirement of approximately 1,600 employees in 3 installments by the end of 2023 at a total cost of approximately NIS 1.5 billion
• Transfer of assets to the state for the benefit of preserving the public interest in the privatization of the company
• Development of growth engines and reduction of excess regulation
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• Gradual opening of the distribution centers to the competition.
• Transition from a rigid expenditure structure to a flexible expenditure structure adapted to the changing scope of activity
Communications Minister Yoaz Handel said: “After years of neglect, we are doing vital root canal treatment for the post office. Everyone knows that the post office suffers from diseases that have not been treated for years like manpower surplus, inefficiency every citizen has felt, and regulation that has burdened society. “Flowed millions to the postal company every time the company was in difficulties without addressing the challenges and administrative and organizational problems of the company. Today begins a new era in postal services in Israel. There will be difficulties along the way, but at the end of the process the public will enjoy excellent and advanced postal services.”
Mishael Vaknin, chairman of the Israel Postal Company, said: “There is no escape from the difficult steps that will be taken. Saving the postal company is a national task that affects every citizen. The road will not be easy, but we are determined. As part of the recovery process, “This is not an easy thing, certainly for many workers for whom the post office is a home. But we have no choice. The next goal to secure the company’s future is an IPO and full privatization as soon as possible – as decided by the finance and communications ministers.”
“The company’s CEO, David Laron, will formulate the company’s new work plan in the coming months, and he will lead the mail to an era of innovation and excellence in service, while stabilizing it financially.”