No easy fix to rail’s challenges
Union disputes continue, the gap between revenues and costs looks set to widen, and anger builds at proposed ticket office closures.
By ‘Industry Update’
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NEW Transport Secretary Anne Marie Trevelyan, the MP for Berwick-upon-Tweed who has taken over from Grant Shapps, has reached out to trade union leaders with a series of meetings.
As this issue went to press, these meetings do not appear to have achieved much, as both the RMT and ASLEF unions announced further strikes on Saturday, October 1, with ASLEF adding a further day on Tuesday, October 5.
The basics of the dispute are a demand for pay increases that reflect inflation, with the employers – the rail operators controlled by the Department for Transport in all but name - offering no more than a 2% increase, with a promise of more if productivity enabling job cuts and reduced operational costs can be agreed.
In the background, the rate of inflation has started to fall slightly, with the consumer prices index (CPI) recording a 9.9% annual increase in August compared with 10.1% in July, which is largely the result of reduced prices for vehicle fuel at forecourts. There are also the measures being taken by the Government to cap energy prices, which some analysts think could cut inflation by up to 5%.
If the bigger picture is considered, the Government has clearly preferred to tackle the source of high inflation instead of funding public sector pay rises for the railway workforce and other publicly funded sectors.
There could be an argument that if rail fares were increased to match inflation, this might provide headroom for greater rewards to be offered to the staff. But the reality is that in March 2022, the increase in regulated fares was restricted to 3.8% as against the retail price index (RPI) the previous July of 7.1%. The RPI figure for July this year was 12.3%, and there would clearly be an uproar if the 2023 fare increase matched this.