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August 29, 2001
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Railways to levy safety surcharge from Oct 1

A safety surcharge ranging from Re 1 to Rs 100 would be levied by the railways on passenger traffic with effect from October 1 this year, the Lok Sabha was informed on Wednesday.

In a suo moto statement, Railway Minister Nitish Kumar said that the move would help raise Rs 50 billion in the next six years for the newly created Non-lapsable Special Railway Safety Fund.

He said that the Union Cabinet at its meeting on August 27 decided to set up the Rs 170-billion fund to wipe out the arrears of replacement on the Railways in a fixed time schedule to promote safety of travelling on the railways in a big way.

The surcharge would be levied as a flat amount depending on the class of travel with a certain surcharge for traveling distances up to 500 km and a higher surcharge beyond 500 km.

While, the lowest surcharge of Re 1 and Rs 2, respectively, would be levied on second class (ordinary) and second class (mail/express) passengers irrespective of the distance of journey performed, the highest surcharge is for AC-I class passengers would have to pay Rs 50 up to 500 km and Rs 100 beyond 500 km.

He said that the fund would be funded through two sources including the railways' contribution through the levy of safety surcharge on passenger traffic which would be able to raise Rs 50 billion over a period of six years.

The other source is additional financial assistance of Rs 120 billion to be provided by the ministry of finance in the next six years, Kumar said.

The minister said in the sleeper class the levy would be Rs 10 for distances up to 500 km and Rs 20 for beyond 500 km.

For passengers travelling by the AC chair car and first class, the surcharge would be Rs 20 up to 500 km and Rs 40 beyond 500 km.

In AC 3-tier, it will be Rs 30 up to 500 km and Rs 60 beyond 500 km. For AC 2 Tier, Rs 40 up to 500 km and Rs 80 beyond 500 km.

As far as the monthly season tickets are concerned, it will be Rs 20 for first class and Rs 10 for second-class travel, Kumar said.

Kumar said with the creation of this fund, the railways expect to be able to wipe out its arrears of replacement of assets in a time-bound manner and thereby considerably improve the safety of the travelling public.

The identification of these arrears is in an advanced stage, he said adding that only the replacement arrears, as approved by the Expanded Railway Board would be charged to this Fund and will be incorporated in a separate book of sanctioned projects called the Green Book.

He said the fund has been set up as the safety of travelling on the railways has been a growing concern and has been under frequent discussion in various fora.

The Railway Safety Review Committee headed by Justice H R Khanna in its report had recommended that in the interest of safety of the travelling public, the Centre should provide one time grant to the railways so that arrears in the renewal of vital equipment are wiped out within a fixed time frame of five to seven years.

The committee had also recommended that one time grant of Rs 150 billion be given by the Centre to the railways to wipe out arrears of replacement of over-aged assets, he said adding that the cost of replacement of such over-aged assets has been reassessed at current price level of Rs 170 billion.

The Khanna Committee had given its interim report in August 1999 and final report in February this year. The Minister said many high level inquiry committees have in the past gone into the issue of railway safety including the Shah Nawaz Committee (1954), Kunzru Committee (1962), Wanchoo Committee (1968) and Sikri Committee (1978).

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