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Saturday, July 21, 2018

CAG: Rlys lost 93% funds during Mamata tenure

Auditing the Railways for the year ended March 2011,the CAG report says that Railways’s accumulated funds eroded by 93 per cent during this period leading to “a severe financial crunch”.

Written by Express News Service | New Delhi | Published: May 16, 2012 12:09:57 am

Railway Minister Mukul Roy may want to run the Indian Railways on the same lines as his party boss and predecessor Mamata Banerjee,but the latest audit report of the Comptroller and Auditor General (CAG) tabled in Parliament on Tuesday says Mamata’s tenure largely witnessed the collapse of Railways’ financial health.

Auditing the Railways for the year ended March 2011,the CAG report says that Railways’s accumulated funds eroded by 93 per cent during this period leading to “a severe financial crunch”.

Like many other government institutions in the recent past,such as the Standing Committee and the Planning Commission,now even CAG has recommended a hike in passenger fares and freight rates to bring the national transporter out of the mess.

While CAG noted that the huge burden of the Sixth Pay Commission and the overall slowdown of the economy did impact Railways’s finances significantly in the past five years,the transporter is,nevertheless,fraught with unsound financial practices,its whole budgeting exercise is faulty and non-transparent.

For instance,the Railways spent 64 per cent of working expenses on administrative,operational and maintenance activities while only 36 per cent was spent on creation and augmentation of infrastructure facilities. The Railways’s dependence on funds from the government has also been increasing over the years since its core activities — carrying passengers and freight — have been bleeding its resources. Its capital fund and development fund showed a huge negative balance.

“This situation would ultimately affect long term sustainability…Railways will be severely handicapped to finance any future developmental expenditure until these funds are recouped over and above the negative amount of Rs 2,101 crore out of revenue surplus,” CAG noted. Similarly,it has also recommended that after a much-needed review,all non-remunerative works pending in the Railways be scrapped.

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