Paul Scurrah scratches himself from Australia Post CEO shortlist

Former Virgin boss Paul Scurrah’s withdrawal as a candidate to head Australia Post leaves at least three high-profile contenders.

Former Virgin boss Paul Scurrah can stay by the pool for now, after scratching as a candidate to be Australia Post CEO. Picture: Dan Peled

Former Virgin Australia chief executive Paul Scurrah has ruled himself out of the running to replace Christine Holgate at the head of Australia Post.

Mr Scurrah, a former Australia Post director, was a favourite to succeed Ms Holgate, who resigned amid an expenses scandal at the postal service involving the spending of almost $20,000 on luxury Cartier watches for four senior executives.

His scratching leaves former Myer chief executive Richard Umbers, former SBS managing director Michael Ebeid and Australia Post executive general manager community and consumer Nicole Sheffield – who is one of Ms Holgate’s preferred successors – as the top candidates.

Mr Scurrah departed Virgin late last month after the company’s $2.6bn sale to US private equity giant Bain Capital was finalised. He served on Australia Post’s board for almost two years from July 2017.

Mr Ebeid is now believed to be the No.1 contender. After running SBS – another government business enterprise – for seven-and-a-half years, he joined Telstra as group executive enterprise, running a division which operates across 20 countries generating more than $8bn in revenue, tailoring “industry solutions” for business and governments.

Former SBS boss Michael Ebeid. Picture: AAP

He is available after leaving Telstra in late October. He would earn a higher base salary if he was the successful applicant at Australia Post.

In his final year there, Telstra paid Mr Ebeid a total of $2m, which included a $1.1m base salary, superannuation and incentives. In the same year, Australia Post paid Ms Holgate a total of $1.6m, including a $1.4m base salary.

Ms Sheffield was paid less than half that, with her pay packet totalling $792,269 – including a $683,972 salary – which was down from $1.2m the previous year after executives gave up bonuses.

Nicole Sheffield. Picture: Dylan Robinson

Mr Umbers – who ran Australia Post’s parcel business for four years from 2010 – before joining Myer, is also understood to be available to start almost immediately. After he left Myer, Mr Umbers joined German discount supermarket Kauf­land, but is understood to be in the market for another job after the company in January abandoned plans for an Australian launch.

Richard Umbers. Picture: Aaron Francis

Linfox Armaguard chief executive and former boss of Australia Post’s international division Annette Carey is also among the contenders and is well regarded by employees and government, making her an ideal candidate.

Former Toll managing director Michael Byrne — who also once served as an Australia Post director — was initially mentioned among the list of candidates, and is also well regarded by government and the Prime Minister’s Office, but The Australian understands things have gone quiet on that front.

Australia Post is paying an estimated $500,000 to global executive recruitment firm Egon Zehnder to complete the search for a new chief executive and managing director.

Among the selection criteria is “significant experience managing stakeholder relationships in a high scrutinised public domain” and “strong commitment to first class business ethics and best practice corporate governance”.

While running Australia Post – which generates $7.5bn and controls more than 80 per cent of the domestic parcel delivery market – is a sought-after position and requires “sharp commercial instincts” it also is a highly political position, given its role in the community and that remains a government-owned enterprise.

“It’s such a political job,” one senior Australian executive told The Australian.

Indeed, Ms Holgate had a torrid year with her political stakeholders. Labor and the Greens sought to disallow changes the Morrison government granted the postal service, including delivering letters every second day in cities and blowing out delivery times on some routes, as it battled to cope with an explosion of parcel volumes during the pandemic.

Ms Holgate then received a rebuke from Prime Minister Scott Morrison, who said he was “appalled and shocked” and demanded she stand aside after it was revealed at Senate estimates that Ms Holgate had gifted Cartier watches to four senior executives in late 2018.

Christine Holgate felt the heat at a Senate estimates hearing. Picture: Gary Ramage

The watches were a reward for brokering a $66m a year deal with three of the big four banks for post offices to provide banking services on their behalf. One of executives to receive a watch, executive general manager of business and government Gary Starr, also received a $413,438 cash bonus, taking his total salary to $1.24m in the 2019 financial year, according to the organisation’s annual report.

“We are the shareholders of Australia Post on behalf of the Australian people … She (Ms Holgate) has been instructed to stand aside. If she doesn’t wish to do that, she can go,” Mr Morrison said.

Ms Holgate initially resisted, issuing a letter via her lawyer stating that there was no legal basis for her to stand aside and saying Mr Morrison had humiliated her in parliament.

But four days after issuing the legal letter, Ms Holgate resigned and apologised.

“My sincere apologies if my words or actions have offended others as this would never have been my intention because I have always held Australia Post in the greatest regard,” Ms Holgate said.

“I deeply regret that a decision made two years ago, which was supported by the chair, to recognise the outstanding work of four employees, has caused so much debate and distraction and I appreciate the ­optics of the gifts involved do not pass the ‘pub test’ for many.”

Ms Holgate’s departure came three years after her predecessor Ahmed Fahour resigned after his $5.6m a year pay packet was revealed, also at Senate estimates. Prime minister Malcolm Turnbull said Mr Fahour was being paid too much and warned of a “cult” of excess among Australian executive remuneration.