With earnings hit by pandemic, railways brace for another round of austerity

NEW DELHI: In a drastic cost cutting measure, the railway board has instructed all zones to freeze creation of new posts except for safety purposes, immediate review of retired and re-engaged staff, exploring possible closure of uneconomic branch lines and rationalisation of passenger reservation counters.
This is the second set of expenditure control measures rolled out by the financial commissioner of railways in the past one month as railway earnings have taken a hit during the Covid pandemic. While freight earning has fallen by nearly 34% during this year as compared to the corresponding period of 2019-20, earnings from reserved tickets has tumbled by 112% and the revenue from unreserved tickets has declined by 90%.
The financial commissioner has also asked general managers to review posts created in the last two years and if these have not been filled, they should review them for surrender. The letter has also specified the interventions including rationalisation of manpower in workshops.
The letter said the Covid is likely to adversely impact budgeted earnings and the national transporter is mandated to meet all of its expenses including pension from own receipts. Citing the need to explore new areas of expenditure control and enhancement of earnings, the letter said, “It may be clearly borne in mind that mere deferment of bills and payment is not expenditure control. Effort has to be in controlling activities, works, purchases and all contractual obligations so that the liabilities are controlled within the available funds, the allocation of which should be prioritised.”
The financial commissioner has emphasised that the recommendations for expenditure control and economy “must be binding in nature” and the need to redeploy manpower to ensure maximum utilisation. The need for grounding of all diesel locos over 31 years through sale or export has been highlighted.
According to the letter, every zone has been asked to review the outsourcing activities such as on board housekeeping service, linen management, station cleaning, manning of escalators and station announcement. Exploring the option of CSR funds to reduce expenditure on these activities has also been suggested.
The finance department has asked all zones to cut down expenditures on events, entertainment and to avoid procurement of new furniture, computers and vehicles.
It is mentioned how annual inspections by general managers become a big affair with huge expenditure. “This should be a silent and low key affair,” the letter said.