Friday, April 20, 2018

This would be the worst ratio since 2000-01, when it was 98.3 per cent, which was previously the worst-ever for the national transporter. The figures will be communicated to the Controller General of Accounts.

Written by Avishek G Dastidar | New Delhi | Updated: April 20, 2018
In 2000-01, when it was 98.3 per cent, it was previously the highest-ever for the national transporter. (Express Photo: Praveen Khanna)

Indian Railways is looking to clock its worst Operating Ratio ever, at around 98.5 per cent in 2017-18, despite best efforts by its book-keepers to make things look better than they actually are.

The figure of around 98.5 per cent is a major face saver as it seemed like in the normal course, without some “adjustments”, the operating ratio — money spent to earn every hundred rupees; the lower the better — would cross the 100-per cent mark. Some timely “earnings” and “adjustments” have shown the ratio to be lower, even though it is still worse than the Revised Estimate (RE) of 96 per cent, sources told The Indian Express.

This would be the worst ratio since 2000-01, when it was 98.3 per cent, which was previously the worst-ever for the national transporter. The figures will be communicated to the Controller General of Accounts.

Railway book-keepers have left no stone unturned while working out the Operating Ratio this time. This is because there was an earnings shortfall of about Rs 8,500 crore aginst RE.

“The working expenses have gone up because of the allowances and pension revision due to the 7th Pay Commission. Our total outgo of pension would be roughly Rs 47,000 crore,” Railway Board Financial Commissioner A K Prasad told The Indian Express.

“Ups and downs in the operating ratio happen. If you see, every time there has been a Pay Commission, our operating ratio has gone up. Like 1999-2001 was comparatively bad because of the Pay Commission. Our Pay Commission impact now is roughly Rs 22,000 crore per year. Certain part of it was provided for, while certain part, like the allowances on which the call was taken later, had to be provided for in the Revised Estimates,” he said adding that “minor adjustments” with regards to loan repayment amount and appropriation to certain funds are still being worked out.

To fill that gap in the books, the biggest contribution to lowering the ratio below the 100-per cent mark was a Rs 5,000 crore “earning” from NTPC as advance on the last day of the last fiscal for freight to be carried in 2018-19. This figure, however, is shown in the revenues of 2017-18, bringing in a leeway for the book-keepers. There is also around Rs 2,000 crore taken from one rail PSU end of the last fiscal for similar purpose ostensibly for monetisation of a railway land in the future.

Similarly, around Rs 4,000 crore of payment of principal component on lease charges has been shown to be paid from Capital (Gross Budgetary Support) as opposed to from the transporter’s Revenues, which is the norm. Railways was also unable to meet its end of the deal to put its share of the money in the crucial safety fund, called Rashtriya Rail Sanraksha Kosh (RRSK), where the centre pays Rs 15,000 crore and Railways is supposed to pay Rs 5,000 crore from its own earnings that never came.

In the revised calculations, therefore, Railways is able to appropriate only around Rs 1600 crore of its share to the fund.

Additionally, the pension debits in March has been around Rs 1,200 crore than the monthly average, giving some breather. On the Capital Expenditure side, actual figures indicate that Railways might end up spending just about as much as, if not less than, the capital spend figure achieved last fiscal.

Without these accounting “adjustments”, the operating ratio would have slid another six to seven per cent, taking the ratio to the about 105-107 per cent, sources told The Indian Express.

The Comptroller and Auditor General in its latest report tabled in Parliament this year has remarked that Railways under-reported its expenditure liabilities in order to make its Operating Ratio look better than it actually was in 2016-17.

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