It is a relief for passengers railways have scrapped Flexi-fare in 15 premium trains. In which the occupancy is less than 50 percent throughout the year. Although the scheme will be discontinued in 32 other trains during lean periods. The time when occupancy dips to 50-75 percent.
On Wednesday Railway Minister Piyush Goyal said It has also reduced Flexi fares. From 1.5 to 1.4 times the base ticket fare in 101 trains.
The step is taken in the wake of the Comptroller and Auditor General (CAG) report in July. As it had flagged the dipping occupancy level since the scheme was introduced in the year September 2016. And had recommended rationalization of flexi-fare.
Railways Sources also said, “That while the railways will incur losses of around Rs 103 crore. By the changes brought into the scheme. It hopes to recover not just the losses but also generate additional revenue. By increasing occupancy through the reduced fares”
The trains in which the scheme will be discontinued. Because of low occupancy include Kalka-New Delhi Shatabdi, Howrah Puri Rajdhani, Chennai-Madurai Duronto.
The trains in which flexi fares will not be applicable during the lean periods. Include Amritsar Shatabdi, Indore Duronto, Jaipur Duronto, Bilaspur Rajdhani, Kathgodam-Anandvihar Shatabdi, Ranchi Rajdhani among others.
The railways had introduced flexi-fare for premier trains On September 9, 2016. 44 Rajdhani, 52 Duronto and 46 Shatabdi Express trains.
Under this, the base fare increases by 10 percent with every 10 percent of berths sold. Subject to a prescribed limit. There was no change in the existing fare for first AC and economy class.
The minister tweeted “As a gift to passengers this festive season. Railways has decided to reduce Flexi Fares from 1.5 to 1.4 times the base ticket fare. And to completely remove Flexi Fares from trains with less than 50 percent occupancy,”
He said “Win-Win Situation: The reduction of Flexi Fares is going to benefit both. The passengers that can now avail tickets at cheaper rates. As well the Railways that will see a surge in demand and occupancy,”
Railway sources said a 15 percent jump in occupancy of the 15 trains in which flexi-fare is being scrapped. It will compensate for the losses.
They added that an increase of 30 percent occupancy in the 32 trains where the scheme is being discontinued. During lean periods will lead to the recovery of losses. From then on any increase in occupancy will lead to additional revenue.
A source also said “The plan is that rationalizing fares would lead to an increase in occupancy. This in turn would ultimately lead to an increase in revenue,”
However, Railways will continue to apply flexi-fare in 101 trains. In trains the average monthly occupancy through the year is more than 75 percent.
“The railways will also offer a graded discount in fares for all classes of current fexi-fare trains. With occupancy less than 60 percent, four days prior to scheduled departure from originating stations.”
“For up to 70 percent occupancy, the discount will be 20 percent on the last fare. From 70-80 percent occupancy, the discount will be 10 percent on the last fare.”