ITI unable to restore employee benefits due to poor financial health

NEW DELHI: Telecom equipment maker is not in a position to restore employee benefits such as festive advance, children education allowance and footwear due to poor financial condition, Parliament was informed today.

As cost cutting measures, ITI management has suspended and withdrawn certain facilities like annual advance fees, school fee reimbursement, uniform including footwear, privilege leave encashment and liberalised leave travel concession encashment from 2003-04.

Subsequently after review of the company's financial position, the management has restored PL encashment, LLTC encashment and uniform to all its employees.

"However, ITI is not in a position to restore other allowances like festive advance, children education allowance and footwear to employees due to poor financial health and continuous losses," Minister of State for Communications and IT Milind Deora said in a reply to the Rajya Sabha.

ITI losses on standalone basis widened to Rs 105.2 crore for the three-month period ended June 30, 2012 compared to Rs 88.15 crore its posted a year ago for same period.

The Minister said that the pay scales of employees working in various plants of the company were last revised in 2000 based on the first Pay Revision Committee (year 1997) recommendations.

"However, on account of losses incurred during the last several years, the company has already been referred to BIFR (Board for Industrial and Financial Reconstruction) and declared sick by BIFR in 2004," he said.

The Minister added that Department of Telecommunications has prepared a revival plan of Rs 4,156.79 crore or ITI which is yet to be approved by Board for Reconstruction of Public Sector Enterprise and Cabinet.

"The revival plan includes salary/establishment cost during revival plan period and 39 months arrears pertaining to above pay revision," he said.