CAG cannot tell Railways how to spend funds: Roy

“It is not for the CAG to tell how an organisation should spend its money,” Roy said on Thursday. “Through its audit,the CAG makes certain recommendations for the sake of financial improvement of a government organisation,which is its mandate. As far as deciding how and where funds should be spent,the decision lies with the Railways,” he added.

In its audit for the year ending in March,2011,the CAG observed that there had been an erosion of up to 93 per cent of the railways’ funds and much of it was attributed to the way the national transporter was allocated its funds. It called for hiking of passenger fares and freight rates,an idea the Trinamool Congress — which has been holding the ministry since 2009 — opposed to. The audit report criticised financial policies,most of which had been rolled out by Roy’s party boss and predecessor Mamata Banerjee. While the CAG report began calling Indian Railways a commercial organisation,sources said that the Railway Minister has stressed the social responsibility of the railways as a transporter.

To tide over the funds crunch,especially the revenue gap created after rolling back the hike in fares proposed by former Railway minister Dinesh Trivedi in Rail Budget in March,Roy has asked officials to focus more on public-private-partnerships and commercial utilisation of vacant railway land.

The report also termed Railways’ budgeting exercise “faulty” and said that there was no system of following up on the promises and proposals made in the Railway budget.