The Hindu Business Line : Rlys rapped for not scrapping surcharge

Indian Railways has again tampered with the passenger fare system — without being transparent about it. Though this year it did not result in any hike in fares, like last year, it did prevent a possible reduction in passenger fares — varying from Re 1 to Rs 100.

The lack of transparency has been criticised by the Parliamentary Standing Committee on Railways in its report on demands for grants. After pulling up the Railways about a year ago for changing passenger fares "indirectly" without informing Parliament, the Committee has stated in its latest report that it "does not agree with such an arrangement".

SURCHARGE SUBSUMED

The Railways recently decided to subsume the safety surcharge in the ticket fares and route it to fund the dedicated rail freight corridor. This was not announced in the Railway budget this year. The level of the surcharge varied on a per ticket basis and could range from Re 1 to Rs 100, depending on distance and class of travel.

The safety-surcharge was levied for a tenor of six years, which was to end on March 31, 2007. The Railways aimed to raise Rs 5,000 crore over the six years from this surcharge.

The Special Railway Safety Fund (SRSF) was meant to help wipe out arrears in renewal of over-aged assets, such as bridges, tracks, signalling equipment and rolling stock.

If the Railways had decided to discontinue the surcharge instead of routing it to part-finance the freight corridor by subsuming the amount, there could have been a reduction in fares.

RAILWAY PERSPECTIVE

When questioned by the Committee on the issue, the Railways pointed out that the amount garnered would be used for support of constructing dedicated freight corridor, and would be called "development charge". The Railways also stated it had adopted a similar strategy a few years ago for "surcharge on accident compensation."