The Hindu Business Line : CAG slams BSNL for poor revenue collection

New Delhi, July 13 The Comptroller and Auditor General (CAG) of India has slammed Bharat Sanchar Nigam Ltd for not improving its revenue collection system because of which its arrears have climbed to Rs 7,502 crore during 2007-08, compared to Rs 7,376 crore in the previous year. Of this, nearly Rs 4,226 crore is considered doubtful of recovery.

The increase in arrears has primarily arisen due to non-payment of dues by BSNL’s subscribers. About Rs 5,151 crore was outstanding against various categories of telephone users at the end of March 2008.

The biggest defaulters are private subscribers (Rs 4,182 crore); the balance due isto come from Central and State Government agencies.

Employee productivity

The CAG has, however, highlighted that BSNL’s employee productivity has improved.

BSNL has 8.30 workers for every 1,000 telephone subscribers in 2003 which has now improved to 4.26 in 2007-08. This is due to a reduction in workforce from 3.45 lakh employees in 2003-04 to 3.08 lakh in 2007-09.

Wasteful expenditure

The CAG has also pointed out that the PSU had taken wrong decisions and made wasteful expenditure, which led to a loss of Rs 1,520 crore.

This includes an excess expenditure of Rs 1,089 crore on interest payment on a loan taken from the Government.

“BSNL failed to retire Government loan of Rs 7,500 crore in spite of having adequate cash reserves of Rs 18,829 crore as of March 2005 parked in bank deposits with average rate of return of 6.19 to 7.38 per cent a year against interest rate of 14.50 per cent for the loan,” the CAG report states.

MTNL’s revenue arrears decreased from Rs 1,401 crore in 2006-07 to Rs 1,358 crore. Of this, Rs 378 crore falls in the doubtful recovery category. MTNL’s manpower has also decreased from 55,760 to 47,351.

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