The Central Government has asked the Bharat Sanchar Nigam Limited (BSNL), the government telecom service provider struggling with financial losses, to consider the option of shutting it apart from disinvestment to rejuvenate the company. After the total loss of Rs 31,287 crore till the end of the financial year 2017-18, a meeting has been held following the meeting with senior telecom secretary Aruna Sundarajan of BSNL.
According to Times of India, During the meeting, BSNL chairman Anupam Shrivastav gave a presentation to the telecom secretary, in which the financial condition of the company, its total loss, impact on its business after the arrival of Reliance Jio, potentially for the employees, the Voluntary Retirement Scheme (VRS) And preferring a detailed description of the retirement plan ahead of time.
Option to shut down the company with disinvestment
Interestingly, on one hand, the government has asked the BSNL to consider the option to rejuvenate itself, on the other hand, it has also said that it should analyze the closure of the company. BSNL has been asked to conduct a comparative analysis of all the options available to the government. Sources said, “These options include involving strategic disinvestment in the company, closure of the company or renewing financial support.”
Large number of employees in big trouble
BSNL said that besides the competition, the biggest trouble for the company is its large number of employees. To reduce the number of personnel, he has said to reduce the age of the VRS or retirement from 60 years to 58 years. The company said, “If the retirement age is reduced from 2019-20, then it will save the company Rs 3,000 crore for the wages.”
VRS will save Rs 3,000 crore
In relation to VRS, the company has said that it will target employees of 56-60 years of age, to which 67,000 workers will be covered. The company said, “If 50 percent of these employees (33,846) are given VRS, then it will save Rs 3,000 crore in salaries. The grace amount will be Rs 6,300 crores from Rs 6,900 crores in various items.
Suggestions for monetization
BSNL also suggested earning income from its land and buildings, which is about Rs 15,000 crore. The company said that this work should be done within the next two to three years by the Department of Investment and Public Asset Management (Dipam).