The Railway Pensions Commission has published its final report. While ATOC and Network Rail have welcomed it, issuing similarly-worded press releases, the unions have not. Unite describes the proposals as ‘controversial’ and ASLEF has expressed ‘acute disappointment’. They have every right to be disappointed as the commission has failed to meet any of the four key demands made jointly by the rail unions.
Whereas we asked for the scheme to be open to all employees, the report recommends closing the current Railway Pension Scheme (sca) [shared cost arrangement] to new starters. Instead, they will be offered an inferior scheme called RPS (acre) [average career revalued earnings]. As its name suggests benefits in this fund will be based on average earnings throughout your railway career, not your final salary as is the case now. They will also be accrued at one fiftieth for each year of service rather than the current one fortieth.
The commission invites companies to buy off the opposition of current scheme members to this two tier system by funding the increasing liabilities (as more of its active members become pensioners) of a closed RPS(sca). In return companies can offset this with the lower costs of the RPS(acre).
In addition the retirement age will rise to 65 and BRASS will be stopped.
The report is so bad in fact that TSSA says ‘we will have to be able to demonstrate to employers that members are prepared to stand up and fight for good quality, affordable pensions’. This is certainly true, but it makes RMT’s muted response all the more worrying. In a letter to all secretaries Bob Crow simply says, ‘In my opinion the only way to deal with the issues raised in the Commissioner’s Report is through an industry-wide forum’. So, more talks, for how long we don’t know. With the commission suggesting early 2009 for implementation, it is hard to see how this course of action will amount to more than just discussions with employers. Even minimally he should state our opposition and prepare us for the fight which must surely come if we are to prevent these proposals going through unchallenged.
The forum will take place on 19 February (around the time that actuaries report the triennial pension fund value) between rail unions and companies, but there is no indication that the government will attend.
This article is based on the Executive Summary of the report. After studying the full report (78 pages), we will produce a special bulletin edition of OTR giving detailed analysis, news of the forum, fund valuation and an industrial action strategy to defend current and future pension provison. To make sure you get your coopy, subscribe to Off The Rails.