Most people you ask wouldn’t know who Christine Holgate is and what she does. Those that do know of her, know that she has been a highly successful CEO at Blackmores and now at Australia Post.
But it would seem she is doomed to be the fall guy because four expensive watches were given to four people who pulled off what is being touted as a $1Billion deal with three of Australia’s big four banks. Now when I say expensive, the grand total of the watches is reported to be ~$20,000, the expense pales compared to the extra revenue for the company and the dividend to its one and only shareholder, the federal government.
Let’s go back a step and look at what has happened recently at Australia Post. Ahmed Fahour preceded Ms. Holgate as the CEO and was remunerated handsomely for his turn-around of the ailing service. He recognised that parcel delivery was the way forward for the business (for a business it is now – not a service) and drove the company towards where it sits today – king of parcel delivery in Australia. This was despite the best efforts of global companies wanting their share of the pie and failing to make the same impact Australia Post did.
He introduced higher postage stamp prices and slower delivery times, much to the chagrin of the Australian public but concentrated more on the lucrative parcel delivery. As it turned out the results were stunning for the enterprise.
Not everyone took a liking to Mr. Fahour and one Prime Minister took exception to his salary and bonuses being more than ten times his own salary. So, when Mr. Fahour departed from Australia Post it was decided that the next CEO would be paid a lot less. Enter Ms. Holgate who left a lucrative role at Blackmores to take on the challenge of growing the business that had already grown extensively under Mr. Fahour.
Ms. Holgate joined Australia Post in 2017 and set about revitalising the ailing Post Office shops run by mums and dads around Australia. These shops were integral to increasing revenue and Ms. Holgate knew that. It came to be that a deal was done with three of the four big banks and these small shops were revitalised as they took on banking services, particularly regional stores. So not only did this deal bring in a lot more revenue to Australia Post it gave a lifeline to struggling business working under the umbrella of the company.
As a result of this deal four people were given a bonus in the form of a watch. I wonder if the same four people were given an equivalent cash bonus, or even triple the value, whether this would be even talked about? Probably not, and there is no logic to it. It is my opinion that given the size of the deal the $20,000 spent on watches was insignificant. It’s taxpayer’s money you cry! Technically yes, but without them doing the deal the government would be getting millions less as a dividend. It was a win-win situation in my view.
I think both the government and the opposition are showing faux outrage on the issue as they try to outdo each other in clambering for the moral high ground in the eyes of the voters. Behind closed doors they would be admiring Ms. Holgate’s business acumen to get the job done.
I think that Ms. Holgate has been thrown under the bus by the Prime Minister as he showed poor political judgement when he answered a question in parliament. He stated; “She has been instructed to stand aside and if she doesn’t wish to do that, she can go.” Maybe he has wanted her to go and this is the opportunity to make it happen.
This does not auger well for Ms. Holgate who deserves better than this. More accusations of excessive spending have since surfaced, one in particular, her $34,000 hotel bill for nine months stay. That is about $4,000 per month or $200 per night if you allow for 20 business days per month. Hardly extravagant on a nightly basis.
If Ms. Holgate was not getting the job done and the business was going backwards, I could understand that people would be concerned, but when the business is growing and profits increasing it is hard to fathom the “outrage”. In isolation $20,000 is a lot for four watches. When it is looked at as part of a $1Billion deal that will return millions to the government it is a trivial amount.