Rail budget must be done away with? Prabhu agrees
“In the long term interest of the Railways, it’s always a good idea to have a consolidated Union Budget,” Prabhu told HT when asked about his stance on the NITI Aayog’s note to the Prime Minister’s Office (PMO), which recommended that a separate Rail Budget should be dispensed with as it has become only a mechanism to announce popular measures.
Rail Budget is set to become a thing of the past, with Minister of Railways Suresh Prabhu on Wednesday endorsing the NITI Aayog’s views that the annual exercise should be done away with.
“In the long term interest of the Railways, it’s always a good idea to have a consolidated Union Budget,” Prabhu told HT when asked about his stance on the NITI Aayog’s note to the Prime Minister’s Office (PMO), which recommended that a separate Rail Budget should be dispensed with as it has become only a mechanism to announce popular measures.
The note was sent to the ministry of railways for its comment. Although the ministry is yet to convey its views to the PMO, Prabhu’s categorical stance suggests that scrapping of the nine decades old practice of presenting a separate Rail Budget could be a fait accompli. NITI Aayog member Bibek Debroy, the author of the note, had made the same recommendation twice last year- in his interim report on the restructuring of railways in March and in the final report in June.
Top railways ministry sources said that Suresh Prabhu was a proponent of a consolidated Union Budget “from Day 1” and even took it up with finance minister Arun Jaitley last year. The minister was, in fact, working with the NITI Aayog to prepare a roadmap to end the British era exercise, said sources. The practice to present a separate Rail Budget started in 1924 and continued since then despite debates questioning its need.
Annual Rail Budget is keenly watched for possible passenger fare hikes- or its absence- and introduction of new trains and rail lines, but the ministry doesn’t need parliamentary approval for them. “Other financial aspects can be merged in the general budget,” said an official.
KL Thapar of the Asian Institute of Transport Development said that dispensing with the Rail Budget will help to “depoliticise” the railways. It will also make it easier for railways to expedite “corporatisation”. “It’s a step in the right direction,” said Thapar.
The practice had relevance when the railways used to be the largest carrier of freight and passengers. It also had a major share in the Budget in terms of revenues and expenditures.