BTTB
07-09-2004, 05:43 PM
http://www.finance24.co.za/Finance/Companies/0,,1518-24_1585292,00.html
Telkom 'breeds poverty'
07/09/2004 17:11 - (SA)
Johannesburg - Three Telkom unions accused the telephone monopoly on Tuesday of undermining the government's mandate to create jobs and fight poverty by threatening to retrench workers and charging excessive call rates.
The unions said they refused to believe that the company - 37.8% owned by the state - was following "the mandate of government" as claimed by Telkom's management.
Dirk Hermann, speaking on behalf of Solidarity, the Communication Workers Union and the SA Communications Union, said if this was so, the company would be creating more jobs instead of reducing its workforce by 7 600 people in the next three years.
Referring to last week's announcement of the belated coming of a rival for the landline monopoly, Hermann said Telkom could not hope to tackle the second network operator by just cutting costs.
He was also concerned about the apparent "shareholder fundamentalism" of Telkom's management.
"This idea is embodied in Telkom's previous annual report and in particular in the wording of the company's strategic aim: 'To increase shareholder value by increasing profit and cash flow.'
"By contrast, the trade unions want an approach that takes all stakeholders into account."
By focusing only on making money, Telkom was also reneging on its obligation under its licence and the Telecommunications Act to promote universal and affordable access to telecommunications services, with an emphasis on the rural poor.
Telkom retards economic growth
Meanwhile, Dawie Roodt, chief economist of Efficient Group, on Tuesday presented a report to journalists showing that Telkom retarded national economic growth through its high call charges and business model.
Roodt postulated that if Telkom increased its rates by the world average, instead of much more than that, interest rates as well as inflation would have been 1% lower than they were today.
Economic growth would have been 0.06% higher a year and about 67 000 jobs could have been created.
Roodt also showed two approaches to charging callers: that used in the US where local calls are often free but are offset by high connection and subscription costs, and Telkom's.
Telkom charged connection and subscription fees below the international average - based on purchase price parity - but substantially higher call rates.
As a result, many poor South Africans can afford to have a phone - but cannot use it.
Roodt's colleague, Charles Snyman, said while there was merit to the claim that Telkom was over-staffed, the planned retrenchments would make little difference to Telkom's balance sheet.
Hermann said the report was not an exercise in Telkom-bashing, but brimmed with "positive business ideas" such as:
* reduce prices, particularly call charges;
* offer innovative access options, like those used by the cellular networks;
* reconnect the 2.1 million disconnected lines;
* roll out "broadband" access for internet and other users;
* develop new "e-services";
* retrain existing staff to take over outsourced work; and
* limit employee reduction to natural attrition only.
The report was handed to Telkom on Saturday. The company has not yet responded.
Growth in different areas
Union negotiators said on Tuesday indications were that Telkom would ignore the "sound" business proposals the study contained.
Telkom said it noted "with interest the suggestion in the unions' report that the company should further reduce its labour expenses by some R1.2bn".
It said the unions' suggestion that Telkom could save jobs by growing the business rather than cutting expenses incorrectly assumed that growth areas in the telecommunication industry were as labour intensive as those in which redundancies were taking place.
"Telkom is... growing its business in the areas of data, call centres and international switch-hubbing, but this growth could not possibly offset the redundancies in other areas of the business," Amanda Singleton said.
She said Telkom took great care in the design and implementation of alternatives to retrenchments.
Edited by Fadia Salie
<b><hr noshade size="1"></b><font size="2"><font color="red"><b>You can take Telkom out of the Post Office but you can't take the Post Office out of Telkom.</b></font id="red"></font id="size2">
Telkom 'breeds poverty'
07/09/2004 17:11 - (SA)
Johannesburg - Three Telkom unions accused the telephone monopoly on Tuesday of undermining the government's mandate to create jobs and fight poverty by threatening to retrench workers and charging excessive call rates.
The unions said they refused to believe that the company - 37.8% owned by the state - was following "the mandate of government" as claimed by Telkom's management.
Dirk Hermann, speaking on behalf of Solidarity, the Communication Workers Union and the SA Communications Union, said if this was so, the company would be creating more jobs instead of reducing its workforce by 7 600 people in the next three years.
Referring to last week's announcement of the belated coming of a rival for the landline monopoly, Hermann said Telkom could not hope to tackle the second network operator by just cutting costs.
He was also concerned about the apparent "shareholder fundamentalism" of Telkom's management.
"This idea is embodied in Telkom's previous annual report and in particular in the wording of the company's strategic aim: 'To increase shareholder value by increasing profit and cash flow.'
"By contrast, the trade unions want an approach that takes all stakeholders into account."
By focusing only on making money, Telkom was also reneging on its obligation under its licence and the Telecommunications Act to promote universal and affordable access to telecommunications services, with an emphasis on the rural poor.
Telkom retards economic growth
Meanwhile, Dawie Roodt, chief economist of Efficient Group, on Tuesday presented a report to journalists showing that Telkom retarded national economic growth through its high call charges and business model.
Roodt postulated that if Telkom increased its rates by the world average, instead of much more than that, interest rates as well as inflation would have been 1% lower than they were today.
Economic growth would have been 0.06% higher a year and about 67 000 jobs could have been created.
Roodt also showed two approaches to charging callers: that used in the US where local calls are often free but are offset by high connection and subscription costs, and Telkom's.
Telkom charged connection and subscription fees below the international average - based on purchase price parity - but substantially higher call rates.
As a result, many poor South Africans can afford to have a phone - but cannot use it.
Roodt's colleague, Charles Snyman, said while there was merit to the claim that Telkom was over-staffed, the planned retrenchments would make little difference to Telkom's balance sheet.
Hermann said the report was not an exercise in Telkom-bashing, but brimmed with "positive business ideas" such as:
* reduce prices, particularly call charges;
* offer innovative access options, like those used by the cellular networks;
* reconnect the 2.1 million disconnected lines;
* roll out "broadband" access for internet and other users;
* develop new "e-services";
* retrain existing staff to take over outsourced work; and
* limit employee reduction to natural attrition only.
The report was handed to Telkom on Saturday. The company has not yet responded.
Growth in different areas
Union negotiators said on Tuesday indications were that Telkom would ignore the "sound" business proposals the study contained.
Telkom said it noted "with interest the suggestion in the unions' report that the company should further reduce its labour expenses by some R1.2bn".
It said the unions' suggestion that Telkom could save jobs by growing the business rather than cutting expenses incorrectly assumed that growth areas in the telecommunication industry were as labour intensive as those in which redundancies were taking place.
"Telkom is... growing its business in the areas of data, call centres and international switch-hubbing, but this growth could not possibly offset the redundancies in other areas of the business," Amanda Singleton said.
She said Telkom took great care in the design and implementation of alternatives to retrenchments.
Edited by Fadia Salie
<b><hr noshade size="1"></b><font size="2"><font color="red"><b>You can take Telkom out of the Post Office but you can't take the Post Office out of Telkom.</b></font id="red"></font id="size2">