News: BSNL employees get August’s salary in September

Compensation & Benefits

BSNL employees get August’s salary in September

The Indian state-owned telecommunications company has been incurring losses leading to problems in clearing staff salaries.
BSNL employees get August’s salary in September

The August salaries many employees of Bharat Sanchar Nigam Ltd (BSNL) had been waiting for have been paid last week. 

BSNL Chairman and Managing Director P K Purwar shared that the salary requirements were met internally. Reportedly, the fund was raised from internal accruals and the outstanding from certain customers, another source said

The Indian state-owned telecommunications company has been facing financial crisis with an estimated loss of around Rs 14,000 crore and a decline in revenue to Rs 19,308 crore during 2018-19. 

It is not only BSNL, Mahanagar Telephone Nigam Limited (MTNL) has also been financially stressed. As the Department of Telecommunications (DoT) works on a rescue plan for these two firms, it might lead to the introduction of voluntary retirement scheme, asset monetisation and allocation of 4G spectrum.

In September, BSNL announced its plan to fire about 30 percent of their contractual employees as it looks for new funds and a way forward for its revival. Moreover, if the Voluntary Retirement Scheme is duly implemented, about 50 percent of the total employees are likely to lose their jobs, in the Pune division of BSNL. 

As DoT and BSNL try to work out a plan to deal with the financial crisis, the future of 1,65,179 employees at the telecom remains unknown. 

In early September, an employees’ union of BSNL had demanded immediate closure of loss-making telephone exchanges, estimated to be about 17,000-18,000. The union had questioned BSNL’s revival plan. Last week, the Cabinet was also unlikely to consider the debt-laden company’s turnaround proposals.

One of the employees unions of Bharat Sanchar Nigam Ltd, Sanchar Nigam Executives’ Association (SNEA), doubts the interest Finance Ministry has in reviving the public sector telecom company. 

“The ministry is of the view that BSNL cannot be revived and no revival package is required,” said SNEA in a note. 

The time is tough for public sector telecom services but with proper guidance and leadership, the impact of the loss can be mitigated. As the times are not all bad for BSNL, while it faces a decline in revenue, it along with Jio was one of the telecom providers to have a net gain in subscribers at the end of July 2019. Government intervention might help BSNL gain back its momentum. But it competes with private players like Vodafone-Idea, which leads the telecom industry in terms of market share, and Jio who sits on the second place.

It is time for the companies and government to work together and see how they can revive India’s telecom sector, which is weighed down by debt of more than Rs 7.5 lakh crore and lower the pressure on revenue, profits and cash flows owing to continuing price competition. 

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Topics: Compensation & Benefits

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