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The Indian Railways currently employs 1.34 million people and the wage bill constitutes nearly 50% of the railways’ working expenses. Photo: Ramesh Pathania/Mint
The Indian Railways currently employs 1.34 million people and the wage bill constitutes nearly 50% of the railways’ working expenses. Photo: Ramesh Pathania/Mint

Railways to review staff strength, deployment to cut flab

An audit company would be identified and entrusted with the task of studying the gazetted manpower employed by the railways, says an official

New Delhi: As part of its efforts to cut flab, the Indian Railways has decided to review its staff strength and deployment.

An audit company would be identified and entrusted with the task of studying the gazetted manpower employed by the railways, said Pradeep Kumar, member staff of the Railway Board, the highest decision-making body of the Indian Railways, on Tuesday.

The Indian Railways currently employs 1.34 million people and the wage bill constitutes nearly 50% of the railways’ working expenses.

The Bibek Debroy committee on the restructuring of the railways, which submitted its report on Friday, recommended that the carrier opt for staff rationalization—redeploying employees more efficiently or cutting down staff strength where necessary—for its long-term viability.

“We are involving outside experts, there are major audit companies we are associating them to study what is our deployment, whether it is ok, or whether there is certain flab or whether certain correction is needed, that study has already been ordered. It will be taken up shortly," said Kumar.

An audit company will be finalized through a tender process and it will assess the optimal level of gazetted manpower required for the railways in the wake of technological advances that it has made in operational and maintenance practices. It will also look at international railway benchmarks to decide on areas where the carrier needs to rationalize its manpower.

The audit companies in the race include EY, KPMG, PricewaterhouseCoopers and Deloitte, said Kumar.

The disbursal of the Sixth Pay Commission has also pushed up the carrier’s costs.

“It has also been noted that the employee costs, including pension, constitute the single largest component in the IR (Indian Railways), which has further become unmanageable after the Sixth Pay Commission. The Seventh Pay Commission in 2016 would further push up the staff costs and pension costs, which will have serious financial implications on IR. Thus there is an urgent need to rationalize the manpower," said the Debroy committee report.

Railways reported an operating ratio of 91.6% in the fiscal year ended March. The operating ratio is a measure of railways’ efficiency and a high ratio implies limited resources for capital investments.

A press statement issued on Tuesday by the railways said that the human resource (HR) audit will begin this year. It further said that a standing committee for HR benchmarking has been formed to do a department-wise preliminary analysis for various activities.

This exercise could further be extended to non-gazetted employees too, Kumar said.

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