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

The narrative painted by the DoT is that BSNL is facing financial crisis due to over staffing, however, the BSNL Employees Union has made it clear that it is only because of the pro-Reliance Jio and anti-BSNL policies of the government.
Centre's move to introduce Voluntary Retirement Scheme in BSNL is a step towards privatisation says union.

Image courtesy: Financial Express

The unions and associations in Bharat Sanchar Nigam Limited (BSNL) have opposed the Centre’s proposal to implement the voluntary retirement scheme (VRS) pointing out that the drive to reduce work force is part of the strategy before handing over the public sector undertaking (PSU) to private players.

“The government in close coordination with the BSNL Board is actively engaged in working out the voluntary retirement scheme with attractive benefits,” an official was quoted as saying. The entire scheme is said to be optional and those attaining 50 years of age can opt for it.

Supporting the official’s statement, BSNL chairman Anupam Shrivastava said, “The government is seriously considering 4G spectrum to BSNL, and a lucrative VRS being offered to the willing employees who would like to take.” The latest reports suggest that Department of Telecommunication is all set to move to Election Commission for getting approval for the scheme.

At present, BSNL has a manpower of 1.68 lakh employees and Mahanagar Telephone Nigam Limited (MTNL) 22,000. The government estimate say that the VRS scheme for BSNL and MTNL employees will have a revenue impact of Rs 6,365 crore and Rs 2,120 crore, respectively.

The narrative painted by the DoT is that the BSNL is facing financial crisis due to over staffing. However, the BSNL Employees’ Union (BSNLEU) has made it clear that the crisis is only because of the pro-Reliance Jio and anti-BSNL policies of the government. In the month of February, for the first time in BSNL’s history, the PSU had not been able to pay its employees.

Also Read: BSNL Crisis Continues: Over 1.68 Lakh Employees Yet to Receive Salary

Interestingly, in 2004-05, when there were a lakh more employees in the company, BSNL had a net profit of Rs 10,000 crore. The work force is not the real problem in BSNL, but the policies of the government are.

“In fact, BSNL started making a turn around in 2014 itself. The company was earning operational profit in the financial years of 2014-15, 2015-16 and 2016-17. However, problem started when Reliance Jio started it’s services in September 2016. Utilising it’s huge financial muscle, Reliance Jio is practicing predatory pricings, with a view to close down it’s competitors,” BSNLEU said in a statement.

One another interesting point to note is that BSNL is the only company with the least debt in entire Indian Telecom industry. “The total debt of BSNL amounts to only Rs. 13,900 crore, whereas the debt of Vodafone idea is Rs 1.2 lakh crore and Airtel has a debt of Rs 1.13 lakh crore. The debt of Jio is about Rs 2 lakh crore. Why was only BSNL denied the permission to take loans?,” Swapan Chakraborty of BSNLEU had told NewsClick earlier.

“The Department of Telecommunication (DoT) is not allowing BSNL to take bank loans to meet its operational expenditures. DoT only allows BSNL to take bank loans for capital expenditure. The stringent conditions imposed by DoT restricts the operations of BSNL,” he had said.

Though the Union Cabinet had assured at the time of the formation that BSNL would take all steps to safeguard its financial viability, whenever the company is in financial crisis, they were denied to take loans.

Also Read: How the Centre is Dismantling BSNL

Portraying how the then secretary of Telecom, J.S Deepak, was shunted out of DoT for opposing the predatory pricings of Jio, BSNLEU said that the Telecom Regulatory Authority of India (TRAI) had helped Reliance Jio in a big way. As a first step, TRAI changed it’s own definition issued in May 2003 regarding predatory pricing. Secondly, in October 2017, the TRAI slashed the IUC (Interconnect Usage Charge), by 57% which benefited Reliance Jio to the tune of Rs. 1,000 crore. At the same time, revenue collections of the older telecom companies had been hit hardly.

“However, what is actually happening is that the government is meting out a step-motherly attitude towards BSNL. The best example is that, BSNL is still not allotted with 4G spectrum, which is hampering the company’s growth in a big way,” said the statement from BSNLEU.

Employees in BSNL, under the banner of All Unions and Associations of BSNL (AUAB), have been protesting against the stubborn policies of the BJP-led centre that is trying to dismantle the PSU. Allocation of 4G spectrum is one of the long pending demands among others.  

Minister of State for Communications, Manoj Sinha, in January 2018 assured the AUAB that BSNL would be allotted with 4G spectrum. However,even after a year since that assurance was given, the Company has still not been allotted with 4G spectrum. The statement said, “The non-allotment of 4G spectrum to BSNL is a calculated move by the government to clip the wings of the PSU service provider.”

BSNL has enough vacant lands throughout the country which is valued at more than Rs 1 lakh crore. Though, they have sought the government’s approval to generate revenues from these by renting and leasing it out, the government has not given any approval for than one year now. The company had estimated to generate at least Rs 5,000 core through this.

VRS is not new in MTNL and had already been implemented twice. But, this could do nothing to revive the ailing company. “So, VRS is not the solution for the financial crisis,” BSNLEU observed.

Also Read: BSNL Employees on 3-day Nationwide Strike, Demand Revival of Public Sector Telecom Entity

“If the government really wants to ensure BSNL’s financial revival, then it must immediately allot 4G spectrum. It should financially help BSNL by extending soft loan for the expansion and modernisation of its networks. The government should also accept the demands of the unions and associations like giving approval to BSNL to monetise it’s vacant lands.”  

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