Minister: 25% of TSTT income pays wages
ONE out of every four dollars made by the telecoms provider Telecommunications Services of Trinidad and Tobago (TSTT) goes toward paying wages.
This was the observation made by Energy Minister Kevin Ramnarine as members of TSTT’s management team appeared before a Joint Select Committee (JSC) of Parliament in Port of Spain yesterday.
TSTT’s acting chief executive officer, Rakesh Goswami, led the TSTT team to the meeting held at the Parliament’s J Hamilton Maurice Room.
Goswami said while TSTT is “still profitable”, the company’s profits have been “reduced somewhat”.
“The organisation has realised that its cost base, its employee cost base, is not in keeping with international benchmarks and that is the area of organisational transformation and so that is the third main thrust that the organisation is embarking on and we are doing that by virtue of Voluntary Separation Programmes (VSEP) which is currently in play,” Goswami said.
Independent Senator David Small said the “mean salary paid per employee” at TSTT is “extremely high” compared to other salaries in the country.
“I have looked at some of your accounts and I understand you quoted some of the international benchmarks about employee cost base and I probably should not quote the exact numbers here but I would say that the mean salary paid per employee is an extremely high number in the context of Trinidad and Tobago and I understand that the company has some challenges,” Small said.
“You explained about the VSEP arrangement but when I looked at it, if you divide the amount of employees by the total salaries number it is a fairly large number and I am just trying to understand other than the VSEP what is the company planning to do, and more importantly, how because the issues around managing staff numbers is sensitive in a unionised environment and I want to get a handle on what is your process,” he added.
TSTT’s executive vice president of human resources, Harigobin Jhinkoo, responded.
“TSTT certainly has its challenges around its people costs which are as the documents say are really high as compared to the benchmarks in the industry,” Jhinkoo said.
He said the company hopes the VSEP will assist in addressing the situation and making the company “more nimble and customer centric”.
As at April 30, TSTT had 2,537 permanent employees, Jhinkoo said.
According to documents TSTT made a profit of $384 million in 2009, Ramnarine said.
In 2013 this figure “collapsed” to $49 million, Ramnarine said.
Reading from a document provided to the JSC by TSTT Ramnarine said: “The pivotal reason for the decrease in the company’s profits is as a result of a court award as it relates to a collective agreement.
“Under the company’s operating expenses it clearly shows that one in every $4 of revenue ...goes to paying wages.”
“That means that approximately 25 per cent of your revenue goes immediately to paying salaries.”