The Department of Telecom is planning to implement the second Voluntary Retirement Scheme (VRS) in the government telecom company Bharat Sanchar Nigam Limited i.e. BSNL. For this, the department will have to obtain approval from the Ministry of Finance.
The telecommunications department wants to reduce the number of employees by 35% through VRS and also wants to improve the financial situation of the company. Economics Times (ET) gave this information in one of its reports. However, no such information has been provided officially by the company or the government.
BSNL seeks ₹15,000 crore from Finance Ministry for VRS
BSNL has requested Rs 15,000 crore from the Finance Ministry to cover the cost of the VRS initiative. ET cited an official familiar with the matter as saying that, through VRS, the company’s board had proposed reducing the number of its employees from 18,000 to 19,000.
Will have cabinet approval after the Ministry of Finance
According to the report, BSNL currently allocates ₹7,500 crore, or around 38% of the company’s revenue, to pay salaries to its employees. The company plans to reduce this expenditure to Rs 5,000 crore per year. After getting approval from the Ministry of Finance, the telecom department will receive approval from the Cabinet.
BSNL’s revenue in FY2024 was Rs 21,302 crore, which was a slight improvement over the previous year. The company’s workforce includes more than 30,000 non-executive employees and 25,000 executives.
VRS was first offered in 2019
Previously, BSNL had first offered VRS in 2019. The program was launched on November 4, 2019 and remained open till December 31, 2019. According to media reports, BSNL had around 1.5 lakh employees at that time , of which approximately 78,569 employees have accepted VRS.
BSNL faces debt crisis
Public sector telecom company BSNL has been grappling with a debt crisis for quite some time. The Indian government has so far supported the company through three stimulus programs. In the first stimulus package of the year 2019, Rs 69,000 crore was approved, which brought stability to BSNL and MTNL.
At the same time, in 2022, a second stimulus package of ₹1.64 lakh crore was approved. Union Minister Ashwini Vaishnav had said at the time that this package would help take BSNL to 4G. After this, under the third stimulus package, the government had approved a Rs 89,047 crore package for BSNL. This package included the start-up of 4G and 5G services, balance sheet strengthening and fiber network expansion.
BSNL could not start 4G service even after 10 years of 4G launch
In India, Reliance Jio, Airtel and other telecom companies have launched 5G services. While BSNL has not yet been able to start the 4G service. 4G was launched in India in 2014. Even after 10 years, BSNL still failed to start 4G service.