The West Bengal chief minister has left Rail Bhawan for Writers’ Buildings in Kolkata. But her stint has left the Indian Railways staring at a financial meltdown.
West Bengal chief minister Mamata Banerji has left Rail Bhawan for Writers’ Buildings in Kolkata. But her stint has left the Indian Railways staring at a financial meltdown.
The downward spiral that began in Lalu Yadav’s time in 2008 saw the cash reserves of Indian Railways falling drastically from a healthy Rs13, 431 crore to a paltry Rs75 lakh today.
This is perhaps the biggest fall in finances for the railways since Independence. Chances are it will severely erode its ability to foot the salary and pension bills of its employees.
Figures culled out from the Railway Convention Committee report by DNA show that between 2008 and 2010, Railways lost a whopping Rs552 crore on an average every month. Look a little harder and it translates into a loss of nearly Rs18 crore per day!
Officials in Rail Bhawan are scrambling to find finances. They are worried that the meltdown will hurt plans to expand services and improve passenger amenities. This downward spiral seems to be headed the Air India way.
The decline, according to the Railway Convention Committee, is because of lack of cost rationalisation initiatives. The committee in its report said: “This has more to do with the rationalisation of tariff by the ministry of railways than its own performance. Railways should endeavour to recover the cost fully from its services keeping in view the fact that staff cost has gone up considerably after the implementation of the sixth pay commission.”
Ministry officials are now sharpening their claws to attack the West Bengal CM’s record during her brief stint as railway minister in the UPA-2 government.
Ironically, the same babus were her most vocal supporters while she literally ran the railways into the ground. They nodded obediently when she refused to increase passenger fares in the three consecutive railway budgets that she presented.
“Our operating costs have gone up significantly. The government has raised diesel prices. The railways consumes 240 crore litres of diesel annually. Already, Rs55,000 crore is the annual outgo towards the sixth pay commission and Rs18,000 crore as arrears. We are facing heavy losses on iron ore loading, which is one of our main commodities. If other revenue options are not tapped, things will be beyond redemption,” a senior ministry official told DNA.
Before the West Bengal elections the same officials had vehemently argued that even a 10 per cent increase in passenger fares would fetch a “paltry Rs2,500-3,000 crore”, which was “inconsequential”.
That suited Mamata’s electoral priorities, which was focussed on maa, mati, manush with the assembly elections in sight. With over 300 new trains launched during her stint, and a marginal increase in revenue, she kept harping on benefits to the humble manush. This led to a severe resources crunch and in the 2011-12 rail budget the ministry could not allocate funds for passenger amenities.
No wonder, plans for capital intensive safety projects like anti-collision devices are receding into the horizon and lives are being lost in train accidents. Envisaged 10 years back, it has still not been implemented nationwide due to paucity of funds. Incidents like the one in Tamil Nadu on Tuesday could have been easily avoided had the ACDs been in place. Over 300 people have lost their lives in train accidents since May 2009.
Mamata’s successor from her party Dinesh Trivedi is now searching for a magic bullet to resolve this unprecedented crisis. Besides passengers, Trivedi is also worried about footing the salary and pension bill for 13.75 lakh employees and 12 lakh pensioners.
In fact, a desperate Trivedi also pitched for a hike in passenger fares during the meeting of the full Planning Commission in August. Trivedi is also facing internal pressure “from the zones and the divisions” to take a decision “on generating revenues,” a senior official told DNA.
Not to be left behind, the unions are also up in arms. The All India Railwaymen Federation has written to Trivedi suggesting urgent corrective measures. Its general secretary SG Mishra told DNA that “we have suggested to the minister that the government compensate the Railways for the subsidies it gives to passengers. We also want AC class ticket-fares to be hiked immediately.”
Moral of the story: bringing politics into enterprises, especially a public service, doesn’t pay, except to the politician.
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