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Huge Wage Bills: DoT Wants Aid For BSNL, MTNL

Communications and IT minister Ravi Shankar Prasad said on Thursday that state-owned telcos BSNLand MTNL are battling heavy salary bills, unlike their private sector competitors. He sought an immediate budgetary support of Rs 1,000 crore to help them battle acute financial distress.

BSNL’s employee cost is 75% of total income, while the number is 87% for MTNL, Prasad said in a tweet. “The same for private telecom companies varies between 2.9% and 5% of their total income. We want to take care of the employees and yet revive these PSUs for a fair competition in the market.”

Separately, he approached finance minister Nirmala Sitharaman, seeking a Rs 1,000-crore bailout. Prasad said, DoT is preparing a “comprehensive revival plan” for BSNL and MTNL. “This is required to ensure the presence of the public sector in order to maintain a balance in the sector. In this regard, a Cabinet Note is being moved shortly.” Prasad’s pitch will comfort BSNL, which is in dire need for funds and is finding it tough to even pay this month’s salary.

Employee expenses, including retirement benefit accruals, were estimated at 66% of BSNL’s operating revenues in FY18 versus 21% in FY2006. In contrast, Airtel spent only around 3% of its revenues on personnel expenditure, while the number was 6% for Idea Vodafone. The private players have, however, outsourced a major chunk of their operations to network management companies and call centres, leaving only a handful on their rolls. This helps them lower manpower cost.―Times of India

 

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