PRESENTATION ON PAY REVISION FOR CPSUs EXECUTIVES w'e'f' 01012007 BEFORE 2nd PAY REVISION COMMITTEE

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PRESENTATIONONPAY REVISION FOR CPSUs
EXECUTIVES(w.e.f. 01-01-2007)BEFORE2nd PAY
REVISION COMMITTEEBYSANCHAR NIGAM EXECUTIVES
ASSOCIATION(INDIA)
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S N E A (INDIA)WELCOMES

• Justice M. J. RAO
  Chairman
• Dr. NITISH SENGUPTA
  Member
• Shri. R. S. S. L. N. BHASKARUDU Member
• Shri. P. C. PARAKH
  Member
• Dr. R. C. PANDA
  Member
• Shri. K.D.TRIPATHI
  Secretary
• Of
• 2nd PAY REVISION COMMITTEE

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SNEA(INDIA)

• Sanchar Nigam Executives Association (India)
  represents about 30,000 executives belonging to
  Telecom Engineering, Accounts and finance, Civil,
  Electrical, Architecture, Telecom factories and
  Administrative wing of Bharat Sanchar Nigam
  Limited(BSNL). The Association is having its
  Central Headquarters at New Delhi. The
  Association is having organizational set up at
  Taluka, District and State level and is having
  membership at all metro and major cities and
  towns, including rural areas.
• 
  
• SNEA(INIDA) plays a major role to ensure
  continued financial viability of BSNL by way of
  continuous interaction with the Management,
  suggesting strategies and plan of action, from
  time to time, and also actively involving its
  members in development, expansion, installation,
  operation and maintenance of Telecom Network. The
  Association also plays vital role in ensuring
  customer satisfaction.

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ABOUT BSNL

• Bharat Sanchar Nigam limited was formed on
  1st October 2000 by corporatising Department of
  Telecom Services and Department of Telecom
  Operations. BSNL is fully owned by Government of
  India and operates throughout the country, except
  Delhi and Mumbai.
• BSNL board comprises of Chairman and Managing
  Director, seven board of Directors, with two
  nominated from Ministry of Communications, and a
  Company Secretary.

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• Vision, mission and objectives.
• Vision.
• To become the largest Telecom Service provider in
  South East Asia.
• Mission.
• To provide world class state-of-the-art
  technology, Telecom Services on demand at
  affordable price.
• To provide world class Telecom infrastructure to
  develop the countrys economy.

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• Objectives.
• To be a lead telecom service provider.
• Build customer confidence through quality and
  reliable service.
• Provide band width on demand.
• To meet all emerging communication needs of
  individual and small enterprise and corporate
  houses.
• Contribute towards
• National plan target of 250 million subscriber
  base for the country by December 2007 in mobile
  sector.
• Broad band customer base of 20 million in the
  country by 2010 as per broad band policy 2004.
• Telephone in all villages.
• Implementation of triple play as regular
  commercial proposition.

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STATUS OF THE BSNL

• BSNL is given MINIRATNA-I Status in spite of the
  fact that it is fully eligible to get NAVARATNA
  Status.

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SOURCES OF DATAData presented in charts and
graphs is obtained from DoT and BSNL annual
reports.
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PHYSICAL STRUCTURE OF BSNL

• The BSNL physical structure comprises of various
  segments, each having definite tasks to be
  performed. A brief picture of the same is given
  here.
• Telecom Circles/Metro Districts
• There are 24 Telecom Circles and two Metro
  Districts. They are responsible for installation,
  operation, maintenance and providing various
  telecom services coming under basic services,
  cellular services and data services within their
  jurisdiction.

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PHYSICAL STRUCTURE OF BSNL

• Transmission Maintenance Regions There are 4
  transmission maintenance regions, one each for
  Northern zone, Southern zone, Eastern zone and
  Western zone. They are to install, operate and
  maintain transmission systems connected through
  optical fiber cable, satellite stations,
  microwave systems. They maintain optical fiber
  cable used as media for interconnecting
  transmission systems. They also operate and
  maintain large Trunk Automatic Exchanges.

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PHYSICAL STRUCTURE OF BSNL

• Telecom Project Circles There are 4 telecom
  project circles, one each for Northern, Southern,
  Eastern and Western zones. They are to install
  large transmission and switching systems, lay
  optical fiber cables and erect transmission
  towers.
• North-East task force circle is exclusively
  meant for installation of transmission systems,
  erection of towers, laying of optical fiber
  cable, in the north eastern states and Assam.
• I.T. Project Circle IT Circle Pune takes care of
  all software related requirements like HR
  Package, Billing etc.

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PHYSICAL STRUCTURE OF BSNL

• Telecom Quality Assurance and Testing and
  Development Circles Telecom quality assurance
  circle is having its operational units in all
  cities/towns where factories for manufacturing
  and supplying of telecom equipment and its
  accessories, meters, OFC cables,drop wire etc are
  situated. The TQA circle tests quality not only
  of the finished equipment but also of the
  components used for the same before giving its
  approval for use in the field.
• T D circle mainly conducts tests of all the
  installed equipments before making over to the
  field units for operations. They also test cables
  meant for local and long distance networks.

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PHYSICAL STRUCTURE OF BSNL

• DATA Network Circle All DATA services right from
  packet switching public data network(PSPDN),
  Internet over dial up and lease line,
  multi-protocol label switching (MPLS-VPN) , broad
  band and other value added services, E-mail
  service, web hosting, co-location of web server,
  Maintaining Network Operation Center(NOC) of
  NIB2, Disaster recovery NOC at Pune, broad band
  project-I , MPLS narrow band project-3, Wi-Fi and
  Wi-Max services are maintained by DNW circle.

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PHYSICAL STRUCTURE OF BSNL

• Telecom Factories There are 3 telecom factories
  which mainly manufacture certain accessories
  required for field units. The main items of
  manufacture are towers, cable jointing kits, coin
  box pay phone, telephone instruments, SIM cards
  etc.

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PHYSICAL STRUCTURE OF BSNL

• Training Centers There are 3 main training
  centers, ALTTC Ghaziabad, BRBRAIT at Jabalpur and
  NATFM at Hyderabad. These training centers are to
  impart pre-appointment training for Group A and
  Gr. B level officers and, in addition, provide
  refresher/in service trainings to both group A
  and B officers. In addition, there are 11
  Regional Telecom Training Centers(RTTCs) and one
  circle telecom training center in each telecom
  circle. They also provide pre-appointment
  training for group B officers and
  refresher/in-service training for all the staff.
  The data below indicates the total number of
  employees trained on year to year basis.

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SERVICES OFFERED BY BSNL

• Basic Telephone Services
• Internet Services
• Data one
• Leased Circuits
• Wireless Services
• Rural Telecom Services

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Basic Telephone Services

• Different kinds of services offered are -
• B-Fone fixed line telephone connection with
  different rental /free call plans. Under
  Sulabh scheme a fixed monthly rental of
  Rs. 120 is charged without free calls. For rural
  customers, the rental varies from Rs.50/- to
  Rs.150/-, based on the exchange capacity. Number
  of free calls is 75.
• One India Plan A fixed monthly rental of
  Rs.180/- with 50 free calls. The call charges are
  Re.1/- per 60 seconds to any place in India
  beyond 50 kms and Re.1/- per 180 seconds to any
  place within 50 kms.
• Integrated Services Digital Network(ISDN) The
  ISDN connections are given under two categories,
  namely, primary rate access (PRI) 30BD and basic
  rate Access (BRI) 2BD . Both these categories
  have different rental /free call plans.

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Basic Telephone Services

• Centrex Customers having more than one
  connection in the same city /town can use this
  facility to have intercommunications . This
  facility is having different plan charges
  depending upon the number of telephones. The
  calls within Centrex numbers are free of charge.
• Intelligent Network Services (IN Services) India
  Telephone Cards, Toll free phone services, Tele
  voting, universal access number service, premium
  rate services, revenue share graded basis
  service, account calling card, virtual private
  network of land line and Mobile are the recently
  launched services under IN platform.
• Public Telephone(PT) PTs are provided to
  physically challenged people for earning their
  livelihood through commission paid by BSNL . PTs
  provide telephone facility for general public for
  making local/STD /ISD calls.

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Internet Services

• Internet under Dialup Access( Sanchar net) This
  facility has different plans, ranging from 25 to
  1000 hours, with different validity periods. The
  Sanchar net service is prepaid. The service is
  offered through Sancharnet Card and customer can
  register on line.
• ISDN Dialup Access This facility also has
  different plans, ranging from 100 to 1000 hours,
  with 2 years validity. This is also a prepaid
  service.
• Internet Leased Line Access This service is
  having different plans wherein a customer has to
  pay fixed annual charges, depending on the
  Bandwidth and whether it is a non ISP(11), Non
  ISP (14) or ISP. Educational Institutions owned
  / recognized by Central/State Govts. get
  concession up to 25 on port charges.
• Net One It is an instant internet service . It
  is an account free internet dial up access, based
  on CLI. In this service, customer will have to
  pay 10 paise per minute for use of internet, in
  addition to telephone dial up charges. It is a
  post paid dial up Internet service.
• Internet Dhabas These are provided to
  facilitate general public to have access to
  internet services in rural areas.

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DATA ONE

• This is a Broad Band data network . It provides 2
  types of plans. Home plan and business plan. Both
  home and business plans have different
  monthly/annual charges, depending upon bandwidth
  and amount of data usage. Depending upon the plan
  opted, customer gets min. 256 Kbps to from max
  2Mbps speed. In each case, there is limit to
  download/upload of data and separate tariff for
  additional usage. In certain plans, modems are
  given free of cost by BSNL. Customers have an
  option to purchase the modem from outside or have
  it from BSNL on fixed monthly rental.

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Wireless Services

• Tarang-WLL-M This is a mobile telephone with
  limited mobility within SDCA. The tariff plan is
  similar to that of b-fone telephone services. The
  pulse rate for local calls and tariff for STD
  calls within territorial circle and outside it
  are different compared to that of landline
  telephones. The WLL-M is also having ONE
  INDIA scheme and tariff is Re.1/- per minute to
  any place in the country. The customer is free to
  use his own CDMA handset as per specifications.
  However BSNL provides handset under different
  schemes.
• CELL ONE and Excel This is cellular mobile
  service having mobility across the country. The
  service is having both prepaid(Excel) and
  postpaid(Cell One) facility with different plans,
  on the basis of which the tariffs for local, STD
  and ISD calls vary. This service provides SMS
  facility of 160 characters. It is also having
  International roaming which is chargeable.

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Leased Circuits

• MLLN Managed Leased Line Network is a leased
  circuit which is monitored 24 hours on all 365
  days centrally at the district level and has
  different plans, with different annual rental
  depending on the distance between the two ends
  and the bandwidth.
• MPLS-VPN/IP-VPN Services The two services have
  different plans, whereas the charges are
  determined based on the bandwidth. If 5 or more
  ports are used then VPN ports get discount
  depending upon the total number of ports. This
  service is particularly meant for small
  enterprises and big corporate houses, having
  their offices / branches located across the
  country.

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Rural Telecom Services

• In addition to provision of telephone
  connections under b-Fone, WLL-M and cellular
  schemes, efforts are continued to be made for
  providing telecom facilities under different
  schemes for all rural places. BSNL of its own has
  provided 5.35 Lakhs village Panchayat telephones
  for the use of public living in rural places. In
  addition, BSNL, by various agreements with DOT
  under Universal Service Obligation Fund (USO
  fund), has provided telephone facilities, both
  with wire and wireless. As on 31.3.06 nearly 1.5
  Crore telephone connections are working in rural
  areas of the country. Based on agreement with DOT
  under USO fund, BSNL, as on 31.3.2006, has
  developed rural telecom network as mentioned
  below.
• Village Public Telephone(VPT) As per agreement
  signed in Nov. 2004, 66,822 villages having a
  population of more than 100 as per 1991 census
  have to be provided with village public
  telephones. This includes 14183 villages to be
  covered by digital satellite phone terminals
  since these are remote and far flung and cannot
  be covered by any other means of communications.
  As on 31-3-2006, 24,687 villages out of 66822
  villages are provided.

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Rural Telecom Services

• Rural Community Phones As per agreement signed
  in Sep.2004 24,794 villages having a population
  of more than 2000 as per 1991 census having no
  public telephone are to be provided with rural
  community phones. As on 31-3-2006 , 16398
  villages are provided out of 24794 villages.
• Replacement of MARR Village Panchayat
  Telephones. As per agreement signed in September
  2003 1,41,233 MARR VPTs as on 1-7-2003 are to be
  replaced by a land line/WLL telephones. As on
  31-3-2006, 104066 MARR VPTs have been replaced by
  land line/ WLL connection.
• Rural Household DELs As per the agreement
  signed on 15-3-2005 rural household DELs are to
  be provided in 1267 SDCAs. As on 31-3-2006,
  3,43,235 rural DELs have been provided in these
  specified SDCAs.

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Role of Executives in BSNL

• BSNL, a telecom service provider throughout the
  country, has about 59,421 officers, as on
  31-3-07, of which 25,830 are entry level
  executives, 31,666 middle level executives and
  1925 top level executives, comprising of Deputy
  General Managers, General Managers and Chief
  General Managers. Total number of 57,496
  executives have got permanently absorbed in BSNL.
  In top level executives, officers belonging to
  finance, civil, electrical etc. wing have got by
  and large absorbed, whereas an insignificant
  number of officers belonging to ITS got absorbed.
  Majority of ITS officers are yet to get
  absorbed. The total number of non-executive staff
  of BSNL as on 31-3-2007 is 2,60,676.

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Role of Executives in BSNL

• The executives belonging to the telecom
  engineering are responsible for complete
  development/expansion, installation, operation
  and maintenance of entire telecom network
  relating to all areas like Switching,
  Transmission, RF network, Ip network, Out-door
  network, OFC network, etc. in the country. They
  have been identified as the BACKBONE for the
  growth of telecom services and are the main
  REVENUE EARNERS of the BSNL. They work across
  entire length and breadth of the country,
  including not only metro/major cities/towns, but
  also in rural, under developed and highly
  inaccessible areas like North east, Andaman
  Nicobar islands, JK, Jharkhand, Assam where
  insurgency is a challenge always to face.

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Role of Executives in BSNL

• The executives of the telecom engineering exhibit
  extraordinary courage and commitment in restoring
  and maintaining telecom services during natural
  calamities like earth quake at Gujarat, Srinagar
  valley and Sunami affected Andaman and Nicobar
  islands.

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Role of Executives in BSNL

• The telecom engineering executives perform round
  the clock duties in almost all telephone
  exchanges, co-axial, microwave, GSM, satellite
  earth stations and trunk automatic exchanges.
  They lay and maintain the entire underground
  local cable network and optical fiber cable which
  forms major trunk junction network. They work at
  factory premises for testing and ensuring the
  quality of the equipment and later, after
  installation, they do acceptance testing of all
  the equipments. They work in training centers
  to impart not only pre-appointment training
  but also in-service and refresher courses of
  training. They are also involved in planning and
  estimation.

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Role of Executives in BSNL

• The executives of architecture ensure that the
  building plans are drawn according to the modern
  needs relating to technical / administrative
  purposes. The executives of civil wing ensure
  that the materials used and the construction work
  is done as per the specifications agreed upon in
  the tender documents. The civil executives main
  job is to maintain the company owned buildings.
  The executives of electrical wing carryout
  electrical installations in all newly built
  company buildings and maintain existing
  electrical installations.

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Role of Executives in BSNL

• The executives of financial wing are mainly
  involved in budgeting and in assisting the
  auditing of company accounts, including that by
  CAG. Their main job is to ensure proper
  utilization of company funds. They are also
  responsible in drawing pay and allowances and
  settlement of monetary claims of all employees.
• The administrative executives mainly work
  in corporate office . Their main responsibility
  is to ensure smooth functioning of corporate
  office in matters related to creation of posts,
  recruitments, promotions, transfers and postings,
  issue of clarifications on administrative and
  financial matters and holding of internal exams
  etc.

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Role of Executives in BSNL

• The executives working in telecom factories
  are responsible for production of certain
  telecom components needed for the maintenance of
  field units. They also manufacture coin
  collecting public telephones, tower materials,
  SIM cards and telephone instruments.

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• Please Note Even with tough and stiff
  competition from other operators, BSNL Assets
  grew by 7614 crores, that is, by 13.6 by the
  year 2005-06.

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Chart showing size of Network and Working
connections in different area of services
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YEAR WISE CELLULAR WORKING CONNECTIONS (in
Thousands) REVENUE(in crores)
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• Please Note
• Cellular service was launched in Oct.2002.
• A steady growth in telephone network resulted in
  a steady growth of working connections
• After launching cellular services (CellOne) the
  number of Cellular connections is almost double
  year after year.
• In spite of disconnections of Telephones in Basic
  Services, yet as a whole there is a growth of 8
  Million connections as on 2005-06.
• The Net effect of increase in Telephone Network
  and working connections is an increase in Income
  from services.

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Mobile (Cellular WLL-M) Services subscriber
base ( in Lakhs)

• Source TRAI Report year ending Mar 07.

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Tele density of BSNL per 100 population as on
31st Dec 2006

• Urban Tele density 17.71
• Rural Tele density 2.00
• Overall Tele density 6.04

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• INCOME
• Please note
• In spite of stiff competition from other
  operators, the income of BSNL grew, year after
  year, and by the year 2005-2006, the income grew
  by 63 over the income for the year 2001-2002,
  mainly because of
• Digitalization of both switching transmission
  equipments.
• Usage of optical fiber cable for trunk local
  junctions.
• Introduction of WLL, cellular, broadband and many
  other new services.
• Large scale development and expansion of telecom
  networks.
• Elimination of over head wires by under ground
  cables.
• Large scale development of rural networks in the
  form of VPTs, rural community phones, replacement
  of MARR VPTs, use of WLL systems for wireless
  communication, revival of household DELs.
• In-service / refresher trainings for executives
  for updating their technical knowledge and
  behavioral and attitudinal training for
  non-executives.
• Staff adopting customer friendly approach and
  attitude.

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Expenditure (in Crores )
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• Expenditure
• Please note
• The expenditure of the company grew year after
  year and reached 50 more for the year 2005-06 as
  compared to 2001-02 on account of
• Steady growth in operating expenditure on year
  to year basis which became 250 greater in the
  year 2005-06 as compared to 2001-02.
• Payment of pay and allowance in IDA scales with
  effect from 1st October 2000 consequent to
  permanent absorption of GroupB, C, D
  staff.
• Adhoc payment of Rs. 2750/- per month for all ITS
  group A officers working on deputation with
  effect from 1.10.2000.
• Payment of pay allowance in IDA scales with
  effect from 1st October 2000 consequent to
  permanent absorption of GroupA officers of
  finance, civil, electrical , architechture wing
  and certain ITS officers.

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PROFIT (in Crores)
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• Profit
• Please note
• The profit for the year 2002-03 has gone down by
  Rs. 5000/- crores as compared to 2001-02 on
  account of ,
• Increase in staff remuneration by Rs. 2500/-
  crores on account of payment of IDA scales with
  effect from 1st October 2000 consequent to
  permanent absorption of group C, D staff
  and payment of adhoc amount of Rs. 2000/- per
  month with effect from 1st October 2000 for all
  group B staff.
• Increase in operating expenditure by Rs. 1500/-
  crores.
• Increase in expenditure towards depreciation by
  Rs. 800/- crores.

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PAY AND ALLOWENCES OF ALL EMPLOYEES w.r.to TOTAL
EXPENDITURE (IN CRORES)
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EXPENDITURE ON SALARY AND OTHER BENEFITS OF ALL
EMPLOYEES AS PERCENTAGE OF TOTAL EXPENDITURE
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DISPARITY OF PAY SCALES INMTNL AND BSNL

• Mahanagar Telephone Nigam Limited (MTNL) was
  formed on 1-4-1984 by coporatising two metro
  telecom districts, Delhi Mumbai.
• Bharat Sanchar Nigam Limited (BSNL) was formed on
  1-10-2000 by corporatising the Department of
  Telecom Services and Department of Telecom
  Operations.
• BSNL provides telecom services in the entire
  country, except the two metro cities Delhi and
  Mumbai.

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DISPARITY OF PAY SCALES INMTNL AND BSNL

• The option for permanent absorption of Group B
  officers in BSNL and MTNL was called
  simultaneously in October 2003.
• The Group B officers comprise of Junior Telecom
  Officers(JTOs) an entry level cadre recruited on
  telecom circles/metro district basis having
  transfer liability within telecom circles
  /metro district recruited for.
• The Sub Divisional Engineers(SDEs) cadre is first
  promotional grade of JTOs and sr.SDEs is a time
  bound promotional grade of SDEs. SDEs are all
  India transferable category.
• SDEs / Sr.SDEs have been promoted on Adhoc basis
  to STS scale.

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DISPARITY OF PAY SCALES INMTNL AND BSNL

• All officers working in BSNL and MTNL were on
  deputation on as is where is basis till their
  permanent absorption. The date of absorption was
  1-10-2000 for both the PSUs.
• In the process of absorption, the cadre of Adhoc
  STS and SDEs were given the choice to opt for
  BSNL or MTNL. However JTOs had no such choice and
  as such have to opt to the same PSU in which they
  were working on deputation.
• The duties and responsibilities of JTOs, SDEs and
  Adhoc STS is one and the same in BSNL and MTNL
  as were in DoT. The conditions of recruitment for
  the cadre of JTOs is also same.

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The CDA pay scales of JTOs , SDEs, Sr.SDEs and
STS working on deputation in BSNL and MTNL prior
to absorption were-

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DISPARITY OF PAY SCALES IN MTNL
AND BSNL

• The pay scales of all the officers while working
  in DoT and later in BSNL , MTNL on deputation
  were one and the same.
• All promotions issued by DoT prior to
• 1-10-2000 were based on combined
  seniority
• lists.

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• At the time of absorption, different set of pay
  scales were given for BSNL and MTNL optees and
  the same are-

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DISPARITY OF PAY SCALES IN MTNL AND
BSNL

• The entry qualification of JTOs remaining the
  same.
• The recruitment and training process remaining
  the same.
• The rules for vertical promotions remaining
  same.
• The duties and responsibilities being one and the
  same.
• Yet, the disparity in pay scales prevails, which
  is causing not only financial loss but also
  considerable demoralization and demotivation.
• We request the Respected Chairman and Members of
  the Pay Revision Committee to kindly decide to
  end the disparity and accordingly recommend to
  the Govt. the pay scales of MTNL for BSNL
  Executives.

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• PROPOSED PAY SCALES, ALLOWANCES PERKS W.E.F.
  01-01-2007.
• Preamble
• With the decision of the Govt. to allow private
  operators with tie ups with MNCs to enter in
  telecom sector and its subsequent decision to
  corporatise the DTS and DTO, BSNL, the newly born
  PSU, has had to face tough challenges and
  overcome the cut throat competition to survive
  and sustain by a steady growth, both in voice
  and data communication.
• BSNL having huge highly trained and qualified
  personnel always has been vulnerable vis-à-vis
  private sector because of its limitations in
  terms of providing pay scales compatible with the
  private sector. Hence attraction and retention of
  talented executives is an unending challenge till
  BSNL offers comparatively compatible if not
  competitive pay packages. We hope that this
  respected 2nd pay revision committee would
  accomplish this important task to strengthen the
  PSU.

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Role of the Government

• The Pay Revision Committee is to recommend
  revision of pay scales for executives and
  non-unionized supervisors of CPSUs.
• The wage revision of non-executives is settled
  through negotiations at enterprise level.
• This dual approach will ultimately nullify
  recommendations of the Pay Revision Committee and
  create anomalies.
• Our considered submission in this regard is that
  the Govt. should only issue broad guidelines,
  based on the recommendations of the Pay Revision
  Committee, to each of the CPSU, with instructions
  to decide pay scales, within these broad
  guidelines, through negotiations with the
  respective officers Associations, so as to reach
  a negotiated settlement.

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Role of the Government

• The Govt. should not issue any Presidential
  directives to the Managements of CPSUs in the
  matter of pay revision of executives since it
  ultimately affects the interests of the
  executives and thus de motivates them.
• The Boards of consistently profit making CPSUs,
  irrespective of the status of the CPSU, should
  have autonomy for deciding the pay packages for
  their executives, depending on their paying
  capacity, through a negotiated settlement with
  the respective officers Association.

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Pay Scales, Allowances and Perks

• In all realities, liberalisation and
  globalization has acquired a very strong foot
  hold in the telecom sector. The latest trend in
  this direction is permission for allowing 74
  foreign direct investment. Naturally, BSNL, a
  CPSU in the telecom sector, has to face
  formidable challenges for its continued growth
  and profitability.
• BSNL should not be compared with other CPSUs as
  the degree of competition prevailing in the
  telecom sector with the private sector, including
  MNCs, is not only unprecedented but not
  prevailing in any other industry.

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Pay Scales, Allowances and Perks

• BSNL, having proved its mettle by sustained
  growth and profitability, despite continuing
  severe handicaps and shortcomings, in terms of
  taking critical policy decisions, relating to its
  growth, demands a special and exclusive
  consideration. Its Board should thus be given
  autonomy to decide its own set of pay scales,
  perks and allowances.
• In the existing set of closed end pay scales, all
  executives in BSNL will continue to stagnate
  throughout their remaining service on reaching
  Rs.18,700 in the scale of Rs.14,500-350-18,700.
  Hence the pay scales should be open ended to
  prevent stagnation.

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Pay Scales, Allowances and Perks

• The stagnation over a long period of service
  results in huge financial loss, which in turn
  causes demotivation, thus inflicting irreparable
  damage on the productivity and profitability of
  the CPSU.
• The ratio of basic pay between the lowest and
  highest paid employee should be at least 110.
  Justice Mohan Committee also recommended the same
  ratio.
• The Pay Revision Committee should recommend pay
  scales which would match those prevailing in the
  private telecom companies, operated by
  Indian/foreign MNCs.

61
Pay Scales, Allowances and Perks

• The Pay Revision Committee should consider, while
  recommending the pay scales, not merely the
  productivity and profitability of a CPSU, but
  should decide taking into consideration the
  severe constraints and conditions under which
  such profitability and productivity has been
  achieved. In this aspect, BSNL, telecom CPSU,
  will definitely stand first. The status of a CPSU
  like Navaratna or mini Ratna should not have any
  bearing for determining the pay scales.

62
Pay Scales, Allowances and Perks

• i. BSNL, a service provider in telecom sector,
  provides telecom services in every nook and
  corner of the country. Consequently, the network
  is huge and wide spread and the staff to operate
  and maintain is also large. However, the cost
  towards manpower is 20 of the total income of
  BSNL.
• The ceiling on payment of perks and allowances
  should be done away with. BSNL Board should be
  given autonomy to decide the quantum of perks
  and allowances, based on its operational and
  functional needs.
• The date of effect of payment of perks and
  allowances also should be the same as the date of
  revision of pay scales, that is, 1st Jan 2007.

63
Attraction and Retention of Talented People

• Fresh engineering graduates coming from reputed
  engineering colleges and getting selected based
  on an all India competitive examination conducted
  by IITs at the behest of BSNL ultimately decline
  the offer of appointment as Junior Telecom
  Officers(JTOs), the entry level executives cadre
  of BSNL. Consequently, BSNL is unable to get the
  required number of talented entry level
  executives. The only reason is poor pay package,
  not only with respect to private telecom
  companies, but even with respect to MTNL, another
  telecom PSU. This is adversely affecting the
  whole recruitment and training plans and also
  future development plans in BSNL.

64

• The only way to bring out BSNL from this
  precarious condition is to primarily end the
  disparity in pay packages prevailing between
  BSNL and MTNL by giving BSNL the same pay
  packages which are available in MTNL. Secondly,
  the Pay Revision Committee should recommend pay
  packages matching those offered by the Private
  Telecom Companies. The data given below shows the
  number of entry level executives(JTOs) who did
  not accept the offer after selection.

65
Attraction and Retention of Talented People

• For retention of the existing executives, the Pay
  Revision Committee should
• Recommend open ended pay scales to totally end
  the stagnation.
• Recommend to remove ceilings on perks and
  allowances.
• Recommend to give autonomy to the Board to
  negotiate with the respective officers
  Associations and decide the pay scales, perks and
  allowances.

66
Relativity

• The ratio of basic pay between the highest and
  the lowest paid employee should be at least 101.
• Justice Mohan committee had also recommended
  similar ratio .
• The ratio of basic pay between the topmost level
  and the entry level in the executive category
  should be 41.
• To attract and retain comparable talents the pay
  packages of CPSUs should be compatible to those
  of private companies in the relevant sector.

67
Existing Pay Scales in BSNL
68
Basic pay as on 1-1-2007

• The pay scales, which will come into effect from
  1st January 2007, have been derived based on the
  following considerations.
• The IDA pay scale of 1-1-1997 of
  Rs.10750-300-16750 (E-2) has been taken as a pay
  scale for entry-level executive, Junior Telecom
  officer (JTO) in our case.
• The multiplying factor for each IDA scale from
  E-2 to E-9 has been derived by taking the
  corresponding IDA pay scales prevailing as on
  1-1-1987, 1-1-1992 and 1-1-1997 since the
  periodicity will be 10 years.

69
Basic pay as on 1-1-2007

• The multiplying factor, derived from IDA pay
  scales, in existence as on 1-1-1987 and 1-1-1992,
  is added to the multiplying factor, derived from
  the IDA pay scale in existence as on 1-1-1992 and
  1-1-1997, and the same is applied for each IDA
  pay scale for determining the new IDA pay scales
  to come into effect from 1st January 2007.

70
Basic pay as on 1-1-2007

• Example
• A) The multiplying factor of 4800 with respect
  to 3000 is 1.6.
• B) The multiplying factor for 10750 with
  respect to 4800 is 2.24.
• Sum total of A) and B) is 3.84.
• The above methodology is adopted since IDA
  scale of Rs.3000 as on 1st January 1987 has
  underwent revision twice in the year 1992 and
  1997 and thus became 10750 in the year 1997.

71
Basic pay as on 1-1-2007

72
Rate of Increment

• The rate of increment should be on percentage
  basis so as to ensure that it takes care of the
  benefits of pay revision from erosion. The rate
  of increment should be at least 5.
• The pay scales should be open ended for
  preventing stagnation.

73
Pay Fixation

• The pay fixation in the new pay scales should be
  on point to point basis to ensure that the senior
  personnel are not placed in a disadvantageous
  position as compared to their juniors. This will
  also help in preventing post revision pay
  anomalies.

74
Performance related payments

• The Justice Mohan Committee recommended a limit
  of 5 of distributable profits as performance
  related payments. Though this recommendation
  should have been extended only to executives, but
  it was generalised and extended to non-executives
  also.
• To make matters straight, this Pay Revision
  Committee should exclusively and specifically
  recommend a reasonable percentage of
  distributable profits as performance related
  payments for executives.

75
50 DA Merger w.e.f. 01-01-2005

• Justice Mohan committee, while recommending pay
  revision once in 10 years for CPSUs with central
  D.A., unfortunately, did not recommend merger of
  D.A. when it crosses 50. 5th central pay
  commission has made such a recommendation for
  central government employees.
• Consequently, both central government employees
  and industrial employees following CDA pay scales
  got 50 of D.A. merged with basic, giving them
  additional benefits.

76
50 DA Merger w.e.f. 01-01-2005

• The justice Mohan committee recommendation for
  adopting CDA pattern for grant of IDA to all CPSU
  employees in reality did not bring IDA at par
  with central govt. employees, but took away the
  advantage of pay revision once in every 5 years.
  Even the 50 D.A. merger is denied. Thus the
  entire lot of industrial employees are put at a
  most disadvantageous position.
• Keeping in view the full justification for 50
  IDA merger, the Pay Revision Committee should
  immediately decide to recommend 50 IDA merger
  with effect from 01-01-2005.

77
Periodicity of Pay Revision

• Till the last pay revision, which was effective
  from 01-01-1997, the periodicity of pay revision
  was 5 years. Justice Mohan committee recommended
  future pay revision once in 10 years on the
  ground that in future industrial D.A. will be
  granted on CDA pattern.
• The Govt. accepted the recommendation to
  implement future pay revision once in 10 years
  for CPSUs. However, granting of IDA on CDA
  pattern was not fully extended since base for CDA
  and IDA still remains separate. Because of this,
  executives in IDA pay scales are put to loss.

78
Periodicity of Pay Revision

• For example, an executive, whose basic pay is
  Rs.10750/- as on 1-1-2002 in the IDA pay scale of
  Rs.10,750-16,750, would have got Rs.14,534/-. On
  the contrary, his pay in January 2002 would be
  Rs. 24,100/-, in the event of revision of pay
  scales having taken place after 5 years, by
  applying the same proportion as that of 1997.
  Thus, an executive at the basic of Rs 10750/- in
  the scale of Rs.10,750-16,750 is faced with a
  recurring loss of Rs.9466/- in the basic pay
  throughout his service. Similarly, executives in
  other pay scales too have to incur loss in the
  basic pay.

79
Periodicity of Pay Revision

• Further, if pay revision is once in 10 years,
  the differences in pay scales appear huge and pay
  revision committees would find it difficult to
  justify the same. The net effect of this would be
  lower pay scales than are actually justified.
• With the entry of private companies, including
  MNCs, the competition has become very tough. The
  executives of better talent in CPSUs, totally
  dissatisfied on account of lower pay packages,
  become easy prey to flight of talent, resulting
  in their exodus to private companies which offer
  them better and attractive pay packages.

80
Periodicity of Pay Revision

• 10 years is a long period and, in the context of
  rapidly changing market environment, CPSUs find
  it very hard to attract qualified and better
  talented people, thus endangering their
  productivity.
• Hence, there is no justification, from any
  aspect, for pay revision once in 10 years. As
  such the Pay Revision Committee should treat this
  as a priority issue and recommend pay revision
  once in every 5 years in the larger interest of
  CPSUs and its employees.

81
Social Security Issues

• With very high escalations in the cost of living,
  in the cost of plot/flat, in the cost of
  education and other social bindings, life is
  becoming tougher and tougher and it will be
  highly frightening to imagine life after
  superannuation, without any social security.
  Living on meagre interest on savings made in
  service is next to impossible. It is high time
  for the Govt. to decide and act, and, as a step
  forward, the Pay Revision Committee should
  consider making suitable recommendations on the
  following issues.

82
Pension

• On the formation of BSNL, the company is
  recruiting fresh engineering graduates at entry
  level of executives. These executives after
  serving 35 to 40 years find on superannuation
  that living is very hard without any social
  security like pension. The pay revision committee
  should make suitable recommendation for extending
  pensionary benefits to the executives recruited
  by BSNL.

83
Gratuity

• The present maximum limit of Rs. 3.5 Lakhs for
  payment of gratuity should be removed and in
  future there should not be any ceiling on
  gratuity payment.
• At present, gratuity is paid at the rate of 15
  days salary for every completed year of service,
  subject to a maximum of 33 years of service. This
  condition is unfair and as such gratuity at the
  rate of 15 days salary should be paid for all the
  years of service rendered by an employee.

84
Payment of Interim Relief

• Since no pay revision has taken place for the
  past 10 years, executives are facing financial
  hardships due to loss in their pay packages. To
  make good the losses, the Pay Revision Committee
  should consider for granting interim relief.
• An interim relief of 30 of basic pay may be
  recommended with effect from 1st Jan 2007.

85
FUNCTIONAL AUTONOMY

• Pandit Jawahar Lal Nehru, loved and
  respected first Prime Minister of our country,
  with clear vision of overall development of the
  nation, set up CPSUs in different parts of the
  country for full utilisation of locally available
  raw material and also to provide employment to
  local people for economical growth of the country
  and the growth of socio-economic conditions of
  the local inhabitants.
• With change of times, many CPSUs became
  sick for various reasons. The political thinking
  also changed from investment to
  dis-investment, causing lot of anxiety in the
  hearts and minds of the employees with regard to
  their bread and butter.
• In the name of liberalisation and
  globalisation, Government allowed private
  companies, including MNCs, to invest and do
  business in almost all sectors, including telecom
  sector. In the bargain, BSNL was formed as a
  telecom CPSU.

86
FUNCTIONAL AUTONOMY

• The private companies by virtue of their
  ownership monopoly can take decisions
  independently and quickly in matters like
  technology, vendors, employees pay scales etc.
  The industrialists have access to meet concerned
  ministers and even prime minister for finding to
  resolve their problems.
• On the contrary, the CEO/CMD of CPSUs have to
  follow preset guidelines in taking decisions on
  all matters related to technology, vendors,
  employees pay scales etc. At the maximum they can
  air their difficulties to the concerned ministers
  only. In all, there is no level playing ground
  between private and public sector. The private
  companies in a particular sector has always an
  edge over their counterpart CPSU. For all acts of
  omission and commission, the CPSUs are answerable
  to other nodal agencies. CPSUs are also
  answerable to the parliament.

87
FUNCTIONAL AUTONOMY

• In such an environment, where if done-why done
  and if not done-why not done is the attitude, it
  becomes very much tough for CPSUs to sustain and
  survive in the world of competition.
• To begin with, for providing certain flexibility,
  at least, in the matter related to Human Resource
  Development, CPSUs should have powers to decide
  the pay scales, allowances, perks and other
  benefits of its employees so as to ensure not
  only the retention of the existing personnel, but
  also to attract new talent into the industry.
  Hence the Pay Revision Committee should make
  suitable recommendation in this regard, enabling
  the CPSUs to look ahead at least in the matters
  related to Human Resources.

88
CONCLUSION

• We request the PAY REVISION COMMITTEE to
  consider and recommend favorably our following
  major issues.
• Ending disparity in pay scales with MTNL.
• IDA pay scales w.e.f 1-1-2007 based on the
  criterion of multiplying IDA pay scales as on
  1-1-1997 by factor ranging from 3.45 to 3.86.
• Merger of 50 IDA with Basic Pay w.e.f.
  1-1-2005.

89
CONCLUSION

• Autonomy to BSNL Board for deciding pay packages
  based on guidelines issued by Government.
• Periodicity of pay revision should be once in 5
  years.
• The ratio of B.P. between the highest and the
  lowest paid employee should be 101.
• To make IDA and CDA base same.
• Interim relief _at_ 30 of salary w.e.f 1-1-2007.
• Removal of ceiling on Gratuity and providing
  proper social security scheme.

90

• THANK YOU