NEW DELHI : As the Budget looms, Railways finances are in disarray, having witnessed sharp increase in recent expenditure. In 2007-08, Railways spent Rs. 75.9 to earn Rs. 100; today it is spending Rs. 95 for the same. Chairman Railway Board Vivek Sahai has maintained this to be a result of additional burden of 6th pay commission, and while Railways has asked for double the budgetary support from the government, the Planning Commission has asked Railways for a passenger fare hike to reduce passenger / coaching operations losses that have ballooned to Rs. 14,000 crore. There is little chance of Minister for Railways Miss Mamta Banerjee followed suit on her budgetary speech on a fare-hike for obvious reasons. But, there were less obvious ones why passengers should not have to bear the burden for Railways’ financial trouble.
Loss on Coaching Operations
| | 06-07 | 07-08 | 08-09 |
| Earnings | 20,419.14 | 22,722.01 | 26,088.09 |
| Expenditure | 26,711.34 | 30,244.46 | 40,045.88 |
| Loss | -6,292.2 | -7,522.45 | -13,957.79 |
White Paper on IR, Rs. In crores
Decisions made within the Railway Board in recent years to engender and protect corruption have depressed Railways finances far more than any pay commission. Although other Railway departments have foregone or lost equally startling sums courtesy carefully cultivated tricks and loopholes, consider only procurement, and within procurement only that specific to upkeep of coaches.
Railways’ Periodic Overhaul (POH) reports show that while the 6th pay commission has indeed increased labour costs, what has also seen an abnormal spike is the annual average material cost per coach, wagon, and locomotive. This is despite the fact that recently POH cycles have been changed from once every twelve to once every eighteen months. With overhauls conducted less frequently, material costs per coach should have decreased. Moreover, since 2006-07, numerous ‘upgraded’ materials have been bought at higher prices for their quality and longevity. However, Railway zones are today buying the same, if not more, ‘upgraded’ material as before. Expenditure has risen, and benefits have accrued only to certain bureaucrats and their crony firms.
In recent years, one of the tricks used to loot Railways has been successive revision of material specifications with the ruse of increasing quality and life-cycles. New specifications have been introduced only in order to restrict competition to pre-fixed suppliers that have then cartelized and jacked-up prices multiple-times market rates. Specification rackets in numerous coaching items have been, in terms of prices charged, at their height in 2008, something that has reflected in total annual coaching expenditure jumping by Rs. 10,000 crore.
Documents confirm the role of a Board Member behind brazen corruption in the ‘up-gradation’ of material for Railway coaches, which stands out even within a consummately non-competitive, kick-back laden, and cartel infested procurement system that has caused losses of around Rs 50,000 crore in the past decade. In the case of the introduction of 7 coaching items such as flooring sheets and seat cushions with tailor-made specifications that led to a Rs. 1,000 crore racket, documents expose the central role of one ex-Member Mechanical . The ex-Member Mechanical did not stop at setting the 7-item racket in motion along with then Finance Commissioner R. Sivadasan with the issue of an unprecedented letter to all Zonal Railways and Production Units on February 14th 2007, which listed highly inflated estimates taken from the very suppliers guaranteed future orders. Ensuring these suppliers lost no time in raking in enormous profits, The ex-Member Mechanical also brazenly exerted pressure, writing and calling zonal tender committees across the country to immediately begin purchasing revised specification material.
In demi-official letters written in end-March 2007, The ex-Member Mechanical instructed General Managers of Zonal Railways to immediately procure the revised materials through ‘coordinated action between the Controller of Stores and Chief Mechanical Engineer’ and conduct ‘no further procurement of these items to old specifications.’ The active involvement of ex-Member Mechanical in pushing these mass-purchases shows itself again in an official note written by a Chief Mechanical Engineer (CME) of a Zonal Railway on April 11, 2007. The CME mentions having received a call from Mr. Rao, who expressed displeasure when informed that purchase of a revised specification coach item, will take another 3 months. According to the CME, ex-Member Mechanical wanted the revised specification material to be made available for overhauling coaches ‘within the shortest possible time’ and even suggested abandonment of ordinary practices in favour of a ‘Spot Purchase Committee’ under the General Manager’s special power!
While sources in the Ministry of Railways have confirmed that RDSO Director Carriage Shailendra Singh has been questioned as a part of the investigation following media expose, and the Competition Commission of india’s independent investigation on the flooring sheet cartel has confirmed bid-rigging, collusion, and unjustified profits, no officer and no firm involved has yet been punished. There are no plans yet by Railway Board to go beyond investigating junior RDSO officers and even question ex- Member Mechanical, who is enjoying retirement.
Perhaps passengers will ultimately have to pay.
Source : THE STATESMAN
No comments:
Post a Comment