Railways May End Discount on AC Class

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News Delhi: The railways is going to withdraw concessions offered to a host of individuals, including senior citizens, who travel by AC first class coaches with the tickets coming at 50 per cent discount.

The proposal, which will require the approval of the political leadership, is being discussed ahead of the rail budget as the state transporter struggles to improve its earnings, faced with an acute fund crunch and demand for massive investment to fix an ageing infrastructure. The railways forgoes nearly Rs 1,400 crore annually by providing concessional tickets to 53 categories, including disabled, artists, sportsmen, war-widows, doctors, senior citizens and journalists. Data on revenue loss due to concessions for AC first class was not available.

Sources told reporters that the railways was looking at the option of withdrawing concessions for several categories of people traveling in AC first class, although there was no move to disband discounts for other classes given the political implications.

Travelling by AC first class is usually more expensive than air travel but armed with the discount, senior citizens have now taken to train travel in the premium class at least for overnight and short journeys. With the discount, the fare is marginally higher than AC-II tier, making it an attractive deal for the seniors.

“If a senior citizen can afford to travel by AC first class, why does he need concession?” asked a senior railway official. Over the years, the railways was forced to bear a huge burden to meet “social obligations”, but the actual cost was never estimated. “Now, railways is expected to run on commercial lines. Provision for free or concessional travel has adversely affected our finances and it is time for course correction,” another official added.

The drive to raise funds from internal sources has come after the finance ministry slashed financial support from the general exchequer to  RS 32,000 crore for the current financial year.

The railways had asked the finance ministry to restore the budgetary support of Rs 40,000 crore and also share the expected burden of Rs 32,000 crore due to implementation of the seventh pay commission’s recommendations, but were asked to raise its own resources.