Modi govt clears Rs 322 crore owed to BSNL, MTNL to help pay off employee wages

After representations by employees’ unions, the Modi government finally agreed on Wednesday to pay over Rs 300 crore to help BSNL, MTNL pay off employee salaries, official sources told National Herald.

However, sources have also confirmed that no fresh allocations have been made to the two PSUs, and Rs 322 crore it is getting from the government was owed to it for some years.

It is understood that BSNL will get at least Rs 171 crore towards re-reimbursement of employee wages and salaries of those working in Controller Communication Accounts (CCA) and Telecom Enforcement Resource and Monitoring (TERM) cells. In the case of MTNL, Rs 151 crore from old GPF claims have been agreed to be paid, which the company will use to pay employee salaries tomorrow.

Till Tuesday, approx 1.76 lakh BSNL employees had revealed that they were yet to receive their wages for the month of February.

The reasons behind govt’s reluctance

However, the alleged embezzlement of employees’ funds by BSNL’s top management, more so since the beginning of this year, has made the Department of Telecom wary of lending any funds to the beleaguered state telecom giant, officials from the DoT have said.

For the first time since its inception in 2000, BSNL has failed to pay salaries to its approximately 1.76 lakh employees, for the month of February. The employees’ union of the state telecom giant wrote to the Union Telecom Minister Manoj Sinha urging the government to release funds so that employees’ salaries could be cleared.

However, it is understood that non-compliance of rules by BSNL’s top management, at the level of the PSU’s Managing Director Anupama Srivastava, is a major reason behind government’s reluctance to release or loan any money.

Further, BSNL’s demand that it be allowed to loan money from the banks to pay off its employees’ salary is finding no takers in the DoT. “The illegal mutation of properties on part of BSNL from DoT is illegal and wouldn’t stand scrutiny. That’s why, it is the DoT which will have to give guarantee to the banks, since BSNL is legally prohibited from doing so,” say sources.

It is understood that the mandatory contribution of the General Provident Fund (the scheme same as EPF, but for central government employees) that BSNL is supposed to deposit with the Department of Telecom (DoT) at the end of each month has not been reaching the accounts of the government.

“It is the government that pays an 8-8.5 per cent interest on GPF. But no money has been deposited in DoT’s account by BSNL in the last three to four months,” official sources told National Herald.

“While BSNL employees expect an interest on the GPF contributions every month, the reality for the last three to four months is that the same money hasn’t been reaching the government accounts at all. How does one expect the government to pay interest in the case,” questioned sources.

The BSNL’s top management is in clear violation of labour laws here. It could be treated as criminal negligence in the court on part of BSNL authorities, say sources.

Sources have further confirmed that all the money that BSNL has been accumulating is being used for revenue, with no funds being used for capital expenditure whatsoever.

BSNL’s mismanagement of its revenues is also apparent from the fact that the money generated from the profit-making circles of southern India, particularly Kerala, has in the past been used as collateral to just meet the operational costs across India.

It is learnt that BSNL is right now finding it extremely difficult to even pay the interest on these loans.

“While BSNL’s CMD is in public backing the revival plan, which in turn involves investments in capital infrastructure, their actions have indicated otherwise,” say officials.

While salaries constitute approx 55 per cent of expenditure incurred by BSNL, there hasn’t been any noticeable increase in the profits of the state telecom company. “Without capital investments and monetisation of its property portfolio, BSNL won’t be able to generate any revenue of its own,” say officials.

It is a complete failure on part of the management. And it is the employees who are suffering, say sources, noting that salaries to the top management had been paid on time even as more than 1.5 lakh employees suffered without any pay.

Officials complain that there has been no reshuffling in the top management despite numerous and well-identified complaints pointing to a deeper “political conspiracy to kill BSNL.”

“BSNL hasn’t been allotted 4G. There has been no push from the government to tell BSNL management to use its revenue for capital expenditure. Despite clear violations, there hasn’t been action from the government against BSNL’s management,” officials pointed out.

Update: The earlier version of the article said that the government had released Rs 1,000 crore towards payment of salaries of MTNL and BSNL employees. The figure had been cited by a news agency. However, official sources later told National Herald that just over Rs 300 crore has been released to the state-run telecom operators, which the government owed them from previous accounts.