Thodey looks to online as union protests job cuts at Telstra AGM

A handful of Telstra staff and Public Sector Union (PSU) members stood outside the company's annual general meeting at the Sydney Convention Centre entrance on Tuesday to protest against the 3,157 job cuts Telstra has announced this year.

The union's Teresa Davison said Telstra's use of funds from the public purse means it's responsible to taxpayers as well as shareholders.

"They've got an AU$11 billion agreement around the NBN ... that's taxpayer dollars," she told AAP.

"We think Telstra does have a responsibility to the Australian community that they're not taking billions of dollars with one hand and sacking thousands of workers with the other."

About half of the cut positions were destined for overseas, she said.

In a statement, Telstra spokesman Scott Whiffin said the "business is changing" to focus on increased productivity.

"While we have proposed that parts of our operations workforce reduce by around 1,100 jobs by June next year, we have made other announcements that could see close to 1,000 jobs added in other areas," he said.

During the AGM, Telstra CEO David Thodey cited the increasing use of online support channels as the reason for the offshoring of contact centre staff.

"On the offshoring of work, our customers increasingly want to interact with us online. Forty percent of customer transactions were completed online in 2013 — compared to only 30 percent in 2012 — and this percentage will grow again this year," he said.

"This means that our contact centre work is declining quickly and will continue to do so."

Telstra worker John Bellingham's job is safe for now, but he turned out in support of dumped and at-risk colleagues.

"His job is likely to go to India," he told AAP. "He was talking to me to see if there was any jobs in my section.

"I don't know if it's something he'd be able to slot into, but I put his name forward."

The union said it thinks shareholders are concerned about the welfare of Telstra staff.

But on his way into the meeting, shareholder Vince Smith said he isn't fully abreast of the job cuts, and is concerned about share prices.

"I'm always concerned about job costs and I'm also ... hoping the share price will go up," he told AAP. "I bought in at AU$7 and now it seems like the company is kind of struggling."

The union claims at least 10,250 people work offshore on Telstra business "on any one shift".

Meanwhile, Telstra maintained its forecasts of low single-digit income and earnings growth as it continues to pump money into its 4G mobile network.

Thodey told the AGM that the telco expects free cashflow of between AU$4.6 billion and AU$5.1 billion for 2013-14.

He also forecast capital expenditure in line with the 14.9 percent of sales recorded last financial year.

Telstra's capex was AU$3.8 billion in 2012-13.

"We expect capital expenditure to be around 15 percent of sales as we continue to build out our 4G mobile network and complete the build of the NBN transit network," he said.

Thodey also signalled further cost savings.

"We believe there remains further opportunity to improve operational efficiency while growing new business opportunities."