Southern Railway hit by severe cash crunch

Trying times: Soiled laundry from trains being cleaned at a Southern Railway unit in Chennai.
S. Vijay Kumar CHENNAI 20 August 2019 10:15 IST
Updated: 20 August 2019 11:41 IST

General Manager sends SOS to Ministry, warns that onboard housekeeping services will have to be terminated

Amid an unprecedented cash crunch, the Southern Railway has sent an SOS to the Ministry of Railways that if adequate funds are not allotted by August-end, it would have no option but to terminate onboard housekeeping services (OBHS), pest control and supply of linen contracts on all 110 long-distance trains.

While officials prepare to face passenger complaints on dirty coaches, smelly toilets and non-supply of linen in air-conditioned compartments in the event of withdrawing the on board services, Southern Railway hopes to receive enough funds to pay pending bills to the tune of ₹22 crore to the contractors and another ₹130 crore to keep the amenities and housekeeping services on.

Though the issue was flagged on July 5, 2019, there was apparently no response from the Ministry, forcing General Manager Rahul Jain to send a reminder a couple of weeks ago, sources in the Railway Ministry confirmed to The Hindu on Monday.


In his letter addressed to the Railway Board, Mr. Jain said that the “shortage of revenue funds for essential passenger amenity activities such as laundry/linen, OBHS and pest control has reached alarming proportion.”

Against the projected requirement of funds of ₹194 crore under the head of contractual payments, the budget grant for 2019-20 was only ₹108 crore. As on March 31, 2019, pending bills to the tune of ₹22 crore were due to contractors in addition to which bills worth ₹40 crore were ready for submission.

Urgent provision

While a sum of ₹39 crore was already spent from the allocation in the current fiscal, there was a liability of ₹155 crore which was ₹86 crore more than the available funds.

“The existing funds will be enough for us only for the bills raised for works done in the month of August-September 2019. In the face of such shortage of funds, Southern Railway shall have no option but to stop all OBHS work on all 110 trains in a few weeks’ time and thus would have to start issuing contract termination notices shortly. Pest control too, will have to is requested that urgent provision of funds may please be made for these essential passenger amenity activities,” the General Manager said.

“We need an immediate allocation of ₹40 crore to settle the old dues to contractors and keep the services on without any interruption,” the official said.

The issue of cash crunch has surfaced at a time when the Railway Board has laid emphasis on Swachch Bharat Abhiyan and other cleanliness campaigns. After the OBHS was introduced, complaints of dirty coaches or stinking toilets came down drastically since the cleaning staff travelled on the train and responded to complaints made to Call Centre, Coach Mitra and Twitter handle of railway officials, among others within minutes.

No response

“The entire OBHS, pest control and linen supply is outsourced to dozens of contractors and we don’t have the infrastructure or manpower to continue the facility if their services are terminated. This is the first time that we are going through this kind of a financial crisis and there is not much of response for alerts seeking funds,” a senior railway official said.

Southern Railway has a holding of about 6,729 coaches in addition to the new Linke Hofmann Busch (LHB) and Ukrisht rakes. The zone has outsourced most of the housekeeping activities on trains that include dozens of special trains that are operated to clear the extra rush of passengers.

Ironically, the Ministry of Railways had released the “New Railways-New Tamil Nadu” document a few days ago showcasing the achievements of the Narendra Modi Government in the last five years and claimed to have earmarked budget grant 125 per cent more on an average each year since 2014-19 compared to 2009-14.

Southern Railway has 74.5% of its network in Tamil Nadu and the remaining running through Kerala, Andhra Pradesh, Karnataka and Puducherry. It operates 1,313 trains, including suburban trains.