CAG Report.

CAG pulls up Railways for losses
Suggests rationalisation of freight and passenger tariffs
Girja Shankar Kaura/TNS

New Delhi, August 5
Expressing concerns over the financial position of the Railways, the Comptroller and Auditor General (CAG) today said that the public sector behemoth suffered a loss of over Rs 3,200 crore for operating on uneconomical routes during 2005-10, while the accumulated losses of its key PSUs also went up significantly.

It recommended rationalisation of freight and passenger tariffs to improve its finances and also suggested that it should take quick decisions about unviable projects and focus on more viable projects.

In the report on the Railways tabled in the Parliament today CAG said, "The way forward for the Indian Railways to improve its finances is to rationalise both freight and passenger tariffs through some form of pre-determined non-discretionary inflation indexing".

It said, "Railways sustained losses of Rs 3,228 crore in operation of uneconomic branch lines between 2005 and 2010 and the loss on operation of such lines increased to Rs 1,198 crore in 2009-10."

It also said that till March 31, 2010, Railways' three PSUs - Konkan Railway Corporation Limited (KRCL), the BWECL and the PRCL - suffered a cumulative loss of Rs 3,435.67 crore, out of which the loss suffered by the KRCL alone was Rs 3,330.93 crore.

It pointed out that holding of just Rs 75 lakh during 2009-10 as surplus reflected an impending financial crisis and suggested increasing market share in bulk freight where the Railways has an inherent competitive advantage.

"Efforts are required to enhance capacity in such a way that the growing demands are satisfactorily met," it said, adding that the public transporter may consider approaching the government for crediting dividend paid it to a non-lapsable fund to be used for financing network augmentation projects.

CAG pointed out that the Railways suffered losses of revenue due from the Container Corporation of India as the haulage charges recovered from it for traffic handled were at sub-optimal rates resulting in short recovery of operational costs.

It raised concern over the unrealised earnings by the Railways which touched Rs 1368.01 crore by the end of 2009-10 fiscal and said that the major portion of outstanding under traffic suspense was on account of un-recovered freight charges from power houses and state electricity boards.

The auditing body also said the Railways have already incurred an expenditure of Rs 8,549 crore on 50 incomplete lines and balance funds to the tune of 16,800 crore were required to complete these projects.

"Audit examination of the 50 ongoing works of the new lines sanctioned for socio-economic development of backward region revealed that five projects sanctioned more than 20 years ago, nine sanctioned between 15-20 years and 36 sanctioned between 10 and 15 years were still lying incomplete as on March 31, 2010," the report said.

Manipulations in Tatkal ticket bookings New Delhi: The CAG on Friday said there were manipulations in Tatkal rail bookings and held reservation clerks, agents and touts responsible for non-availability of these emergency tickets to genuine passengers. An audit of Tatkal and advance reservation system in the Railways by the Government Auditor showed that genuine users for whom the scheme was meant for were not able to access the facility with ease as it was susceptible to manipulation. "There were irregularities such as booking of all Tatkal quota tickets within a few minutes of the opening of reservation," the report tabled in Parliament said. — PTI