Sunday, August 16, 2015

Indian Railways (IR) is one of the world's  largest employer. At the end of the fiscal year 2013-14, the number of regular employees stood at 13,33,966. This figure in itself does not necessarily make Railways a bloated organisation. Report of the Committee for Mobilization of Resources for Major Railway Projects and Restructuring of Railway Ministry and Railway Board, popularly known as Bibek Debroy Committee, argues“…the over-staffing of IR is too much of a generalization. With substantial recruitments having taken place in RPF/RPSF, medical, education and Group D, the real problem is the composition of the workforce, with a shortage in the core skilled operations of running trains. The so-called teeth/tail ratio is low.” RPF and RPSF stand for Railway Protection Force and Railway Protection Special Force respectively.

With this the Bibek Debroy Committee draws our attention to a very important fact that the Indian Railways is involved in a myriad of activities that should be better left to others. For instance, Indian Railways runs 168 schools “to provide education to 27,216 children of Railway employees and also to 38,441 who are not the children of Railway employees.” Indian Railway Medical Services employ 2,597 medical officers and 54,000 paramedical staff. The Committee has rightly suggested that a significant portion of these activities can be outsourced. However, the claim that the over-staffing is limited to only non-core activities is a bit more contentious one.

The Committee report itself contradicts its above claim of over-staffing in IR being too much of a generalization in subsequent chapters. While talking about the imminent deleterious impact of the future pay commissions on IR balance sheets, the report says, “… urgent steps need to be taken to right size IR by rationalizing manpower.” Further the Committee goes on to say – in complete contradiction to its earlier theory of low teeth/tail ratio – “Since officers’ categories in most departments are actually over-manned, this [allowing deputation of IR employees to outside organisations] is a good mechanism for managing costs.” If there was anything left after this contradiction, it was completed by the report going on to say - “Railways should also attempt, in consultation with Staff Federations, an exercise aimed at rationalization in the light of significant technological improvements and automation in many areas in IR. This would help eliminate present anomaly of pockets of ‘excess’ in many areas coexisting with absence of staff to man newly created assets.”

Let us look at the issue of teeth/tail ratio more deeply. One of the benchmarks to ascertain whether a railways organisation is over-staffed or not is to look at the traffic units per employee ratio. The metric frequently used is (NTKM+PKM) per unit number of employees. NTKM is Net Tonnes Kilometres and PKM is Passenger Kilometres. In my personal opinion, this is not a very good metric. Among other things it ignores topographical factors and hides regional variations. However, more than one Committee reports have used this metric. If we use the NTKM and PKM data for 2013-14, the (NTKM+PKM) per employee comes out to be 1.37 million. If I remove the staff which provides security, runs schools and hospitals and assume that it will not have any bearing on NTKM and PKM figures, then the (NTKM+PKM) per employee bounces up to 1.51 million.

This improvement is pretty marginal even with respect to a bit older data available for other countries. The productivity of employees based on the same metric in 2006-07 for Russia, Japan, South Africa, Australia, Canada and United States stands at 2, 2.1, 3.4, 3.6, 10.4 and 15 million respectively. Such wide variation also depletes the credentials of the metric itself. However, some may argue that the productivity will indeed see a jump if we also remove the employees of the production units of the IR. The productivity will increase but the extent of its rise cannot be stated with any conviction, because unlike security, schools and hospitals, I am not sure it one can remove the employees of the production units without affecting the NTKM and PKM figures. What IR today spends on the employees of production units will be spent (may be lesser) for procuring from the market. I am not sure of how the cost differential of the ‘before’ and ‘after’ the extrication of production units from IR will play on the NTKM and PKM figures. What is now certain is that the claim of over-staffing in IR being too much of a generalization is untenable.

Moving on, the biggest miss, in my opinion, of the Bibek Debroy Committee report, has been a complete overlook of gender distribution in the staff of Indian Railways despite having a full chapter on ‘Human Resource Management’.

Before concluding this four part series, let me add just a bit on the policing services used by the railways. IR has its own police forces in Railway Protection Force and Railway Protection Special Force under the RPF Act of 1957 and the Railway Property (Unlawful Possession) Act of 1966. The powers for registration of crime and investigation, however, vests with Government Railway Police (GRP) which is funded equally by the State Governments and IR. However, IR has no administrative control over GRP. Further, there is a police force in each district “entrusted with the task of protecting railway tracks, bridges and tunnels.” The Committee argues for outsourcing most of these functions to private security operators.

While not disputing what the Committee recommends, I will enumerate few interesting international models. Internationally, both models – security provision by state police as well as private forces – are followed. For instance, railroad security in Canada is provided by two private police forces namely Canadian National Police Service and Canadian Pacific Police Service. In Germany, federal police Bundespolizei (BPOL) is responsible for security in German railways. It is subordinate to Federal Ministry of the Interior.

Britain has a useful model that can be considered for India as well. The agency responsible for rail security in Britain is British Transport Police. It works on strategy provided by British Transport Police Authority, whose members are appointed by Secretary of State for Transport. British Transport Police earns money by charging for the security services it provides under a Police Service Agreement (PSA). PSA holders consist of Network Rail, Train Operating Companies and freight companies. Network Rail is the owner and operator of national rail network and its infrastructure assets in Britain.

Irrespective of few – and minor – disagreements I have with the report of the Bibek Debroy Committee, the latter gets it broadly right. Its recommendations should be implemented forthwith and while adhering to the timeline it prescribes.

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