Debroy panel report with receptive ministry

Govt in tune with some key recommendations such as independent regulator, merging staff cadres and reform in accounting practices

A committee headed by Bibek Debroy on restructuring of the country’s railways, presented its final report to the ministry on Friday. Debroy, vice-chairman of National Institution for Transforming India (NITI) Aayog, is likely to meet Prime Minister Narendra Modi over the weekend.

Some of the recommendations in the 319-page report are likely to meet opposition from staff unions but senior officials said the government was likely to adopt the proposals on setting up a regulator, on accounting practices and reorganisation of railway services.

The regulator, as envisioned by the committee, would be independent of the ministry and have quasi-judicial powers on rates, safety rules, fair access, service standards, licensing and setting technical standards.

The panel has also recommended giving non-discriminatory access on new tracks being built under the Dedicated Freight Corridor (DFC) to both Indian Railways (IR) and private operators. “For this purpose, DFC Corporation should be made autonomous and separated from IR,” it has said.

The proposal to merge the various railway service cadres is also likely to be accepted, with prospective effect. “One round of meeting with the Union Public Service Commission on this matter has already happened,” said an official.

According to Debroy, the silo structures of the eight Group-A services within IR has hit team work. He has suggested either amalgamation of all eight existing services into a unified Railways Service or merging these into an IR Technical Service and IR Logistics Service; the panel has recommended the latter. The panel has also recommended lateral flow from elsewhere — chartered accountants, bankers, financial management experts, research assistants and scientists.

The recommendations on accounting are also likely to be adopted, for better calculation of costs. Till now the railway had focused on expenditure accounting, said an official. “With the diminishing government funding, the railways have little option but to look for non-government sources of funds. This imperative is a major driver for refinements in the way railways prepares and maintains accounts and costs its businesses,” the panel has said.

According to Debroy, the railways have given little attention to revising the norms for apportionment of joint costs and the system also neither tracks assets nor assesses the liabilities.

The committee has drawn a time line for implementation of the proposed recommendations for the first five years. This will involve a transition to commercial accounting, greater decentralisation to the zones and cleaning up of finances between the government and the railways in the first two years. Then, setting up the Railways Regulatory Authority of India and implementing human resource changes in the next three years.