BSNL Revival Plan: With 77,000 Applications, Over Half The Company’s Workforce Opts For VRS Scheme

BSNL Revival Plan: With 77,000 Applications, Over Half The Company’s Workforce Opts For VRS SchemeBSNL headquarters in Delhi (Wikipedia)

Over 77,000 employees of state-owned BSNL have so far opted for the recently launched the Voluntary Retirement Scheme (VRS) so far, PTI reported quoting a company official.

Nearly one lakh BSNL employees are eligible for the recently announced VRS scheme. BSNL’s total staff strength is about 1.50 lakh. The effective date of voluntary retirement under the present scheme is 31 January, 2020.

The ‘BSNL Voluntary Retirement Scheme - 2019’, that was rolled out recently, will remain open till 3 December. BSNL is looking to achieve a saving of about Rs 7,000 crore in wage bill, if 70,000-80,000 personnel opt for the scheme.

According to the plan, all regular and permanent employees of BSNL including those on deputation to other organisations or posted outside the corporation on deputation basis, who attended the age of 50 years or above are eligible to seek voluntary retirement under the scheme.

The amount of ex-gratia for any eligible employee will be equal to 35 days’ salary for each completed year of service and 25 days salary for every year of service left until superannuation. All normal pensionary benefits under Rule37A of the CCS Pension Rules in 19 addition to the ex-gratia benefits would be available to the employee who has opt for the VRS.

In 2018-19, the company's revenue was around Rs 19,308 crores with employee benefits expense accounting for 75 per cent of the firm's total revenue at Rs 14,488 crore. This implies the per employee cost is about Rs 9.6 lakhs.

The employee benefits expense of BSNL in 2016-17 was about Rs.15,715 crore. The employee strength of BSNL in that year was 1,96,448. This implied per employee cost is about Rs 8 lakhs.

Mahanagar Telephone Nigam Ltd (MTNL) too has rolled out a VRS for its employees. The scheme, based on Gujarat Model, will be open for employees till 3 December, 2019.

The Union Cabinet had last month approved a plan to combine MTNL - which provides services in Mumbai and New Delhi - with BSNL that services the rest of the nation.

The rescue package approved by the Government includes infusion of Rs 20,140 crore for purchase of 4G spectrum, Rs 3,674 crore for Goods and Services Tax (GST) to be paid on spectrum allocation, companies raising Rs 15,000 crore in debt on the sovereign guarantee Government funding, Rs 17,160 crore VRS and another Rs 12,768 crore towards retirement liability.

The two firms will also monetise assets worth Rs 37,500 crore in the next three years. MTNL has reported losses in nine of the past 10 years and BSNL too has been ringing in loss since 2010. The total debt on both companies stood at Rs 40,000 crore, of which half of the liability is on MTNL alone.