BTCL defaults on Tk 2,259cr to exchequer

BTCL defaults on Tk 2,259cr to exchequer

The state coffer is at least Tk 2,258.76 crore short, thanks to Bangladesh Telecommunications Company Limited's failure to deposit the sum for mismanagement, shows audit report.

The BTCL, whose main offering of landline telephone has fallen out of favour with the advent of mobile phone, provides a host of telecom services to stay alive by obtaining licences from the Bangladesh Telecommunication Regulatory Commission, the regulator.

And as per licensing terms, the state-run company has to share a portion of the revenue earned from the services with the BTRC, which then deposits the sum to the state coffer.

In July 2008, the BTCL was made a public limited company and its tendency to skip payments took root three months later.

Since October 2008, the BTCL has been skipping its payments to the BTRC, found Bangladesh Comptroller and Auditor General, which pored over the state-owned company's books for fiscal 2017-18. The report was presented before parliament in June this year.

The BTCL owes Tk 628.40 crore to the BTRC as the regulator's share of the revenue from interconnection exchange (ICX) service from October 2008 to June 2014.

When a call is made from a mobile or fixed line number, the BTCL as an ICX routes it to the destination network in the case of a local number or to the international gateway (IGW) operators for a foreign number.

The BTCL also has the licence to act as an IGW operator and it missed payments for this service, too.

It failed to pay Tk 944.56 crore from the revenue earned from handling incoming and outgoing international phone calls from October 2008 to June 2014.

The payments were regular from July 2014 to April 2016 and then stopped the following month.

The telecom watchdog is owed Tk 389.03 crore from the BTCL's IGW service revenue from May 2016 to December 2017.

From its landline service revenue between October 2008 and December 2017, the BTCL was supposed to share Tk 298.68 crore with the BTRC. But it hasn't.

Similarly, it owes Tk 2.09 crore from the revenue earned from international internet gateway service from July 2015 to December 2017.

"The BTRC has sent many letters to the BTCL to pay its dues," the CAG report said.

But all calls fell on deaf ears.

The BTRC chairman wrote to the posts and telecommunications division's secretary, who is also the BTCL chairman, seeking his intervention about the unpaid dues but to no avail, according to the report.

Had BTCL furnished the sum to the exchequer on time, the government would not have needed to borrow the amount from domestic sources to meet the deficit and pay high interest on the loan, it said.

The CAG audit team also found that BTCL's internal control system was weak. And there is no responsible officer or cell for monitoring it.

This made paying the dues challenging.

Despite repeated requests from the CAG audit team for documentation of how the BTCL was keeping track of the huge amounts of dues to the telecom regulator, nothing was provided.

Although the BTCL is a large organisation with a purchase committee in place, it has not adopted a purchase plan.

The CAG also found that the guidelines issued by the National Board of Revenue for the collection of value-added and income taxes were not being followed by the different departments of BTCL.

No register is maintained properly in this regard, it said.

What is more damning is that the CAG found no trace of any internal audit system: the independent audit agency could not find any report from the previous year.

Asked about the dues unearthed by the CAG audit, BTCL Managing Director Rafiqul Matin said a portion of the dues has been cleared already in nine instalments.

"We are now regular with the payments," he said.

However, a recent BTRC document shows that its dues from BTCL's IGW service stand at Tk 1,136 crore -- Tk 192 crore more than what the CAG audit had found.

The BTRC is trying to collect its share of the revenue from the BTCL, said its Vice-Chairman Subrata Roy Maitra.

"In some cases, the operators go to the court, leaving us unable to take action," he added.

Once a hugely profitable enterprise, the BTCL has been racking up losses since fiscal 2009-10 save for fiscal 2012-13, when it turned in a profit of Tk 5 crore. It last logged in proper profit back in fiscal 2009-10: Tk 106.1 crore.

With the view to giving relevance to the dated company, the government has been sanctioning one project after project worth thousands of crores of taka.

Since 2009, it has implemented 10 projects involving about Tk 6,000 crore.

Its ongoing projects are worth about Tk 7,500 crore, with the biggest chunk -- Tk 3,314.9 crore -- allocated to the project styled "Modernisation of Telecommunication Network for Digital Connectivity".

The project will introduce modern telephone exchange, high-speed internet and sophisticated telecommunication network systems at the district and upazila levels.

Telecom Minister Mustafa Jabbar is buoyant that the lumbering company will turn the corner this year.

"I have been informed by the BTCL management that they are doing great this year -- I think they will make a profit."

Asked if the BTCL will clear its dues to the BTRC, he said: "Everything will go in the right direction from this year."