Ensure Financial Viability of BSNL for It’s Revival, Say Unions

As the crisis in the government-owned Bharat Sanchar Nigam Limited (BSNL) continues, the unions and associations within the public sector undertaking have put forward a clear revival plan which the Bharatiya Janata Party-led central government doesn’t seem to have. To deal with the prolonged crisis in the company, the unions are seek a soft loan from the government for the capital expenditure of the company.

BSNL has been demanding the government to take steps to ensure financial viability of the company. In fact, during 2000, the then Union Cabinet had given written commitment to ensure the financial viability of the BSNL. So far, BSNL has sought a soft loan of Rs 3,500 crore as an immediate relief, however, nothing has been given.

“We have been demanding that there should be a mechanism to get loans for BSNL because the company alone can’t meet the category expenditure and operational expenditure. The management is not allowing to purchase the things which the company needs. As such, BSNL service is deteriorating even in the best performing circles,” Swapan Chakraborty, deputy general secretary of the BSNL Employees Union (BSNLEU) told NewsClick.

The Kerala circle of BSNL, one of the best performing circles of BSNL for the last 19 years, is not in a position to do any maintenance work because of cash shortage since the management is not allotting money. For the last few months, Kerala circle has been having pending bills with the Kerala State Electricity Board (KSEB).

In addition to this, the Kerala circle, which remained unaffected even when most of the circles were not able to pay the salaries for employees in February this year- a first in the history of BSNL- is now struggling to pay the salaries. According to media reports from the state, some smaller lose-making exchanges in most of the districts were forced to close down and the services under these exchanges were redirected to the higher exchanges nearby.

The situation of Kerala circle is enough to portray the prevailing crisis in the BSNL, said Chakraborty, pointing towards the magnitude of crisis in BSNL.

Also read: How the Centre is Dismantling BSNL

Meanwhile, the Centre has constantly been saying that they are considering revival plans for the company. So far, BSNL unions and associations have proposed many steps for the revival of the public sector telecom service. Among those, one of the main demand is for the allocation of 4G spectrum to BSNL. This demand comes at a time when private operators are already preparing to migrate to 5G services.

When asked about the steps taken by the government to make the 4G services of BSNL competitive, Communication Minister Ravi Shankar Prasad said in Parliament on July 24 that the proposal received from BSNL is under consideration in the Department of Telecommunications.

“The reports are saying that the government is considering a revival package. Actually what is the revival package? Yes, the government is bringing a revival package, but it is not for the revival of BSNL, it is for selling the company,” said Chakraborty.

The employees have organised a demonstration raising the issues in BSNL on Wednesday, August 7. Other than seeking financial viability, the employees and officers demand the removal of the total ban imposed on capital expenditure by BSNL and allow field units to carry out capital expenditure, where revenue is assured. They will also mark their protest against the retrenchment and the repressive actions for even legitimate trade union activities.

As part of cutting down “avoidable expenditure”, BSNL management in June this year had decided to retrench 30% contractual workers.

“During the various review meetings with the higher management, the liquidity position and financial crunch in BSNL had been discussed and it was decided to issue necessary instructions/guidelines immediately to reduce the expenditure in the various items including outsourcing Contract Labour,” said the letter which was issued by the company’s corporate office to all the circle heads across the country in June.

Talking about the government’s decision to downsize the strength of contractual labour in BSNL, Communication Minister informed Parliament on July 17 that the has informed that austerity measures and guidelines have been issued to circles for reducing costs.

Also read: Centre’s Move to Introduce VRS in BSNL A Step Towards Privatisation, Says Union

Along with the down sizing of the number of contractual workers, Centre had implemented voluntary retirement scheme (VRS) in BSNL. Though the scheme is said to be optional, the unions and associations in BSNL claim that it is a strategy before handing over the PSU to private players.

Chakraborty said, “In the name of VRS, the government is retrenching the workers without giving proper benefits. The government has also proposed a reduction in the retirement age from 60 to 58. All these are retrenchments because at the time of formation of BSNL, union cabinet had ensured the job security of the BSNL employees.”

The government, however, is justifying the retrenchment saying that 76% of revenue of the company is spent for the salaries of employees. BSNL’s expenditure for employees is about Rs. 1,300-1,400 crore per month and for last 6-7 years it has been the same. In 2015-16, BSNL got operational profit of Rs 32,000 crore. At that time too, expenditure for employees was the same. Last year, the revenue was about Rs 19,000 crore and yet the expenditure for employees remained the same.

Chakraborty said, “The expenditure of the employees is not increasing, rather it is decreasing day by day. But as the revenue earning has decreased drastically, the ratio of expenditure for the employees seems to be increasing. It is simple mathematics.”

He said, “BSNL has been converted from a government department to public sector. At that time, there were 3.5 lakh employees and now the company has a total workforce of 1.68 lakh. So, today the government cannot blame about the expenditure for employees.”

“Along with the manpower, the government is also targeting the assets owned by BSNL. At present, BSNL has a debt of Rs 20,000 crore and the government says that the debt would be put in a “special purpose vehicle” and it will be debt free,” he added. “To detune the amount, the land of BSNL will be sold. For that, they have identified 23 pieces of land belonging to BSNL and they have calculated the land value through corporate value. But the actual market value would be many times more than the corporate value,” he said.

One of such plot is in Thiruvananthapuram, which is associated with the regional telecom training centre of BSNL, and has been scheduled for selling. The company is selling the land for Rs 10 lakh per cent of land (one cent= 40.47 square meter). But the actual market value of one cent of land is about Rs 30 lakh. The total land being scheduled for selling is 1,17,644 square meters and it is being scheduled to be sold for one third of the market value.

“This is looting of public property. Earlier, the government had done the same in the case of Videsh Sanchar Nigam Ltd and the same is being repeated for BSNL too. Ultimately, the BSNL lands will be given to the corporates in the name of special purpose vehicle. It is not the revival of BSNL, it is the selling off of BSNL.”

Read More: Unions to hold Dharna on July 16 Demanding Revival of BSNL Instead of Retrenchment of Workers