Even as railway minister Mamata Banerjee has announced a white paper on railway finances to review the state of finances under her predecessor Lalu Prasad, the Comptroller and Auditor General of India has slammed Prasad?s handling of railway resources and introduction of the controversial surcharges. In fact it has asked the ministry to keep a clear account of the surcharges on passenger fare and freight.

In a compliance audit of railways for the fiscal 2008-09 which was tabled in Parliament on Friday, the CAG has rapped the railways for disguising the erstwhile safety surcharge and including it in the passenger fare as a development charge, amounting to over Rs 585.39 crore in 2007-08.

?Though the levy of safety surcharge was discontinued from 1 April 2007, its benefit was not passed on to the passengers as this amount has been subsumed with passenger fare in the form of ?development charge? to fund the dedicated freight corridor (DFC) and continues to be collected from the passengers,? the report noted.

The ministry of railways also did not heed the advice of the Standing Committee on Railways to dispense with the surcharge, the CAG observed. More importantly, it does not have separate accounting classification to record collection on account of Development Charge.

The railways? accounting system has also come under a cloud as the CAG in its audit pointed out that although the railways levied a number of surcharges on freight, it does not maintain a separate account head to record these charges. In 2007-08, the railways collected over Rs 2,800 crore through its various fees on goods transport such as busy season surcharge, Development Surcharge, Terminal charge.

Meanwhile, the CAG has also rapped the railways? poor passenger facilities in a separate performance audit of the ministry. Mamata?s ministry has come under the CAG fire for the delay in running of passenger trains.

?Indian Railways addressed punctuality solely as an operational

aspect, where trains handed over late by one zone to another were recorded as being pundctual so long as they do not get delayed further, without addressing it from the passenger?s perspective also.

As such, while zones continued to report a healthy punctuality

performance of 95 percent, trains repeatedly reached destinations beyond their scheduled time. Even the prestigious Rajdhani and Shatabdi trains that were reviewed reached destinations late on 53 percent of their runs during 2007-08. Punctuality was also being incorrectly reported by the zones,? the CAG report noted.

Interestingly, the slew of new trains announced by railway ministers in subsequent Budgets too has not found favour with the CAG. ?In nine zones, detailed cost benefit analysis prior to introduction of new trains was not available. Consequently nearly 30% of the newly introduced trains (31 out of the 108 pairs) in these zones in the last five years had less than 50% occupancy in 2007-08,? the report observed.