Dec 18, 2020

'Profitable' SLT  borrows to pay staff bonuses

Although Sri Lanka Telecom PLC (SLT) claims of securing a net profit of 6.7 billion rupees during the first nine months of 2020 and an annual growth of 35%, it has reportedly sought over 1,500 million rupees from bank overdrafts to pay the annual bonus of its employees.

For the year 2020, the SLT Board of Directors has approved an annual bonus equal to 04 months basic salary. 

The SLT has obtained overdrafts from Hatton National Bank, Commercial Bank and Sampath Bank.

It is said that out of the Rs. 1,500 million, Rs. 1,000 million has been allocated for bonus payments of non-executive employees while the remaining Rs. 500 million has been allocated for bonus payments of executive level employees.

Internal sources of the SLT point out that therefore, the SLT's portrayal of profits is a mere hoax.

Sources add that for many years, top executives have continued the practice of showing profits limited to mere figures without any smooth cash flow.

The company is in a debt of Rs. 70 billion and has already signed several agreements which puts them in a risk of borrowing over a further Rs. 20 billion in the future, 'Sri Lanka Mirror' learns. (Relevant agreements will be published in due course)

Telecom OSP, meanwhile, owes nearly Rs. 5 billion a year to foreign companies, including several Chinese companies, in exchange for providing services such as new connections and maintenance, three years after deferred payments. The agreement is said to be a singular one.

Before foreign companies stepped in, these services were provided by nearly 20 local companies. However, SLT had given contracts to foreign companies after removing all these local companies.

As a result, the SLT is compelled to pay in dollars while the interest payments too are calculated in dollars.

Following is the circular issued by the CEO of Telecom with regard to the payment of staff bonuses.

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