ISLAMABAD: Pakistan Railways (PR) has started working on various steps to overcome financial losses which at present amount to Rs8 billion excluding Rs40 billion pension payments for retired employees, senior officials said.
According to senior PR officials, the PR management is working on short-term as well as on long-term projects to overcome financial losses and make the entity a profit-making public sector organisation. They said PR has recently approved first land rules to generate additional revenue, rationalisation of procurement to reduce expenditure, diversification of income through branding, outsourcing and services, meterisation of railways housing colonies, and outsourcing of production units on public-private partnership (PPP) mode.
Moreover, in the long run, the management is seriously taking the completion of projects such as the ML-1 and the Pakistan, Afghanistan, Uzbekistan Railway initiative, aiming at revitalising the railway system and steering it towards prosperity.
The officials said that PR in 2022-23 generated a total of Rs62.5 billion in revenue from railway operations, Rs3.2 billion from rent of land, and over Rs2 billion from selling scrap, of which, Rs40.607 billion were spent on pensions, Rs35.7 billion on salaries. The PR liabilities, at present, stand at Rs24 billion which also include Rs20 billion of pension, Prime Minister’s (PM) assistance package, and benevolent fund.
One of the major challenges faced by Pakistan Railways is its expenditure on salaries and pensions, which has exceeded the total revenue generated by the railways.
With over 61,000 employees, Pakistan Railways faces a substantial financial burden. In the same financial year, their total salaries exceeded Rs35 billion, while the total number of active pensioners exceeded 111,000, with pensions totalling over Rs40.50 billion.
It is evident that urgent action is required to address the financial losses and ensure a safer and more efficient railway system. Despite achieving a record revenue of Rs62 billion during the financial year 2022-23, the railways fell short of its target by Rs7.42 billion. The railways have set a target of Rs80 billion for 2023-24, with a revenue target higher than the previous year by over Rs10 billion.
However, one of the major challenges faced by PR is the escalating expenditures on salaries and pensions, which have surpassed the total revenue generated.
The salaries of pensioners exceed those of current employees, exacerbating the financial challenges. A significant portion of the railways’ revenue is allocated towards these expenses and the purchase of diesel. In the financial year 2022-23 alone, an estimated Rs47.36 billion was spent on these items.
The loss of human lives in train accidents is a grave concern. Between 2018 and March 2021, numerous train accidents resulted in the deaths of 230 people and serious injuries to 285 individuals.
These incidents involved passengers, passers-by, and railway employees. In January 2021, the annual accident report by Pakistan Railways revealed that 137 accidents involving various vehicles occurred in 2020, resulting in 56 deaths and 58 injuries.
Furthermore, numerous incidents of fire have been reported in different railway vehicles. These accidents have had devastating consequences, such as the derailment of the Jafar Express in Sibi in 2022, injuring six people, and a major accident near Pannu Aqil that claimed the lives of 307 individuals.
Copyright Business Recorder, 2023