Have ministers told railway bosses to cap pay rises at 3%?
Impossible to say with certainty: the Department for Transport (DfT) says that employers were able to negotiate freely but “with clear directives from the government on the modernization to be carried out”. The government has clearly defined the financial parameters, which RMT leader Mick Lynch called the “fingerprints of Grant Shapps and the DNA of Rishi Sunak”.
The industry has been told, directly or indirectly, that wage increases can only be accompanied by “productivity gains”. With more and more industries officially on the Treasury’s balance sheet, rail is more or less a public sector employer. During Covid, rail operators have been relieved of franchises that would have seen them go bankrupt and placed on new contracts where revenue, or lack thereof, is the government’s concern. The salary increase in all railway operating companies is being negotiated at national level.
Network Rail, meanwhile, said it would get no increase to its £41.7billion five-year budget. Chief executive Andrew Haines said any pay rise had to come through cost savings and productivity – a position that mirrors the message given by the Treasury elsewhere in the public sector. He said it could top 3% – but also said there were no productivity gains that would allow a rise close to RPI inflation, the usual rail benchmark, at 11.1%.
Are the T&Cs of railway workers in danger, as the union claims?
Yes, to some extent. A company’s productivity gain is another employee’s wasted weekend. Flexible work and schedules are in question. Rest days are targeted at rail companies, where Sunday work has traditionally been voluntary and paid at overtime rates.
At Transport for London (TfL), a pension plan review has been ordered as part of the emergency funding deal. London Underground is also looking to cut 10% of its frontline staff, which employees say can only negatively affect their workload and well-being.
Has the RMT stopped modernization, as management claims?
Probably – although “modernization” is still quite a loaded term. The union declined to discuss specific grievances broadcast by Network Rail, such as the length of time it took to agree a new communications app to send messages to staff working remotely; or if entire teams of workers needed to be assigned to tasks when only one person (plus new technology) was required; or if it blocked the use of drones to examine train tracks for wear and damage. The RMT has a reputation for intransigence – but also argues that many changes in the name of ‘modernisation’ are a backhanded way of lowering conditions and cutting staff.
Asked directly, Mick Lynch said: “We are not resistant to change. We negotiate changes on a permanent basis with our employers… What we have here is an unreasonable program of wage cuts and reduced working conditions.
Has the Tory government slashed £4billion from transport funding?
No – at least not really. Over the past two years taxpayer spending has increased dramatically: the government has incurred £16billion in extra costs for the railways over the past two years and provided nearly £5billion in funding emergency at TfL, as revenues dried up during the pandemic.
The RMT’s argument seems to be that the government has always needed to fully subsidize the railways: the annual subsidy has effectively balanced the books in the confusing merry-go-round of railway money. On the mainline, around 20% of paying passengers have yet to return since the pandemic, amounting to £2billion in annual revenue. The Treasury has now indicated that it will not continue to fill this gap.
A £2billion ‘funding shortfall’ has also emerged at TfL, according to the union, due to the loss of revenue from Covid, where the government has only provided short-term, partial and conditional bailouts rather than to guarantee the system. London is still suffering from the critical decision taken by a certain former mayor, Boris Johnson and then Chancellor George Osborne in 2015 to scrap an annual operating grant worth £700m which left TfL dependent on revenue from rates when Covid hit.