Fact Check: Is Centre Really Giving Free Rail Tickets to Migrants?

Centre, states or the migrant workers - who is paying how much for the railway tickets of the stranded labourers?

Centre, states or the migrant workers - who is paying for the railway tickets of the stranded labourers now returning to their native homes? What is actually the extra share of money being paid by the Railways? And why are the political parties passing the buck over paying the fare?

The government has been trying to project that a huge bulk of the fare is being paid by the Railways that has subsidised the rate for the migrant labourers during the lockdown. The reality is that the rail fares have not reduced, but the cost incurred by the Railways have increased. Let’s decode the numbers.

First, Understand the Chronology!

• On 1 May, the central government, on request of various state governments, allowed special trains run by the Indian Railways for migrant workers to return to their native states. The government decided to run a total of 100 trains to ferry stranded migrants to their home states, the first of which ran from Hyderabad to Jharkhand’s Hatia with over 1,200 migrant workers.
• The Railways is charging non-AC sleeper fare as per distance along with a superfast charge of Rs 30 and a reserved-berth charge of Rs 20 levied on each ticket. This includes drinking water as well as meals. However, railway officials said a share of expenses on the meals being provided at the stations are being borne by certain state governments.
• The political slugfest intensified on Monday, 4 May, when Congress interim President Sonia Gandhi announced that the party's state committees will pay the train fare on behalf of the migrant workers.
• Denying that there was ever a plan to make the migrant workers pay for the fare, Joint Health Secretary in his daily briefing on Monday said that the total ticket amount has been divided between the Railways and the states in a 85:15 ratio. That is, according to him, Railways will bear 85% of the total cost incurred in one person’s journey.
• A railway official also said that for the first 34 trains, the national transporter spent Rs 24 crore, while the states had spent Rs 3.5 crore.

Breaking Down the Numbers: Behind the 85-15 Split

BJP leaders have been drumming on the fact that the central government is already paying a huge percentage (85%) of the cost involved in transporting the migrant workers back to their homes by trains. Hence, according to them, it is only fair to ask state governments to help “collect” the remaining 15%. But that big percentage maybe just a technicality.

Here’s an extremely simplified example. The real costs and logistical expenses are different.

Under normal circumstances, let’s say the total cost of running a train from Place A to Place B one way is Rs 1,000 and there are 10 people traveling in a compartment. The fare charged from each passenger is Rs 50. Because the Railways are a public utility service, it is anyway subsidised by the government . So, the total fare that the Railway can recover from 10 people from one-way travel is Rs 500 out of Rs 1000. The rest of the 500 rupees is a subsidy given by the Railways. On its return journey, the railway incurs another additional operational cost and again recovers a part of it during normal times.

Now, with the ‘Shramik special trains’ being run during the lockdown, the total cost of operations for the train to travel from A to B, one-way (Rs 1,000) and the fare for each person (Rs 50) to travel that distance remains around the same. But the number of people traveling has reduced to 7 instead of 10 (2/3rd capacity), to maintain social distancing during coronavirus. Therefore, the amount recovered by the Railways from fare will be (Rs 50 x 7) Rs 350. Automatically, the subsidy amount (ie the difference between the total cost and the amount recovered through fares) increases. (Total cost of operations = Fare charged + Subsidy)

Moreover, due to lockdown, the trains are returning empty. Even though the Railways incurs a cost of operations on its return journey, the amount being recovered is nil. This is the additional percentage of subsidy margin that the Railways is bearing.

In a normal situation, on every ticket that it issues, the Railways declares that it recovers only 57 percent of the cost of travel on average from fares. That is, it gives a subsidy of 43 percent but now due to a lesser amount being recovered through fares despite the operational cost remaining high, the percentage of subsidy incurred by the Railways has almost doubled to about 85%, a Railway official told The Quint on condition of anonymity.

So basically, the Railways is not paying an additional 85% for the migrant workers. It already provides a subsidy during normal time, the rate of which has now doubled due to additional costs.

But it must be noted that the ticket fare for the migrant workers remains almost the same as usual and the Centre has transferred the responsibility of collecting that cost onto the state governments.

The Bone of Contention: Who Pays the 15%?

Now the remaining 15% is the bone of contention. Who is paying for that? The states or the migrant workers? The Centre has maintained that the train travel was allowed on requests from the state governments and hence they should be the one arranging for the money.

To get back at Sonia Gandhi, BJP MP Subramanian Swamy on Monday tweeted, that “migrant labourers will go free and ministry will clarify with a statement".

Joint Health Secretary Luv Agrawal said that the Government of India or the Indian Railways has never said anything about charging the migrant labourers.

However, on Saturday, 2 May, an internal letter issued by the Ministry of Railways said: “The local state government authority shall hand over the tickets to the passengers cleared by them and collect the ticket fare and hand over the total amount to Railways.”

DJ Narain, the Press Information Bureau officer for the Railway ministry confirmed to The Quint that the letter stands as is and there is no change in the guidelines issued. Hence, there is still no clear instruction given to the states to pay the fare on behalf of the migrant workers.

Narain told The Quint, "Barring 2-3 states, all have to agree to bear the cost of return of the stranded migrant workers."

Migrants Stuck in the Mess

While Kerala CM Pinarayi Vijayan ruled out paying the fare for migrant workers and urged the Centre to pay on behalf of them, Bihar CM Nitish Kumar in a video statement on Monday said the government has been giving money to the Railways for the transport of the workers.

There are source-based reports saying Gujarat, Rajasthan, Jharkhand have also agreed to pay the fares for the migrant workers. However, ground reports do not support this as many migrant workers in Gujarat told Ahmedabad Mirror that they have had to pay a sum of Rs 600-700, despite not having any earning during the lockdown.

In Karnataka's capital Bengaluru, a government official confirmed the workers were paying their own way home on the Shramik Special Trains, reported PTI.

It is unclear if states like Odisha and Madhya Pradesh which are receiving migrant workers will bear any cost in the process.

The railway official told The Quint that it was conscious call to not run these trains free of cost because, "There are going to be many many more trains running in the future. We cannot create a template today which is unsustainable for tomorrow. It is a minimalistic cost."