Mahanagar Telecom Nigam Limited (MTNL) has announced that they are planning to provide Voluntary Retirement Scheme (VRS) to their employees. According to the reports, the company is going to offer VRS of Rs. 1000 crore following the approval of Telecom Commission, the highest policy-making body of the Department of Telecommunications (DoT) in April 2016.
“We will soon send a note to the Cabinet for approval of MTNL’s VRS plan. The Telecom Commission recommended it in April this year, but there has been no movement since then. It’s a part of the revival plan for the telecom PSU (public sector unit), and the first stage is Cabinet approval,” said by a senior official from the ministry.
As per the reports, around 5000 employees are likely to be opting for Voluntary Retirement Scheme, and this would lead to Rs. 400 to Rs. 500 crore savings every year for Mahanagar Telecom Nigam Limited. This move is taken to free up the particular resources and to make more investment in Network.
“Stagnant revenues and a high employee structure are the biggest problem areas for MTNL. Telecom is a sector which needs to fix investment for modernisation. But, on the contrary, capital expenditure in MTNL is quite less. There are also assets which need to monetize,” the official added.
The State-run Telecom Operator also plans to invest Rs. 2000 crore over next two to three years to upgrade and expand its network. Currently, this network is struggling to survive hard in the competition market.
Mahanagar Telecom Nigam Limited is a state-owned telecommunications service provider in the metro cities of Mumbai, New Delhi and the island nation of Mauritius in Africa. MTNL posted in June about the loss of 718.02 crores, and the total income decreased from 4.5% to 744.72 crores.