Rail Union Pensions
Thousands of workers past and present, who have an interest in the Railways Pension Scheme (RPS), need your help. The rail industry unions – ASLEF, CSEU, RMT and TSSA – are backing a major campaign to safeguard workers’ retirement benefits.
The unions believe the RPS is under threat and members need to be alert and informed. We are calling on employers to:
CAP EMPLOYEE CONTRIBUTIONS TO 10.56%
KEEP BENEFITS AT THEIR CURRENT LEVEL
STREAMLINE THE SCHEME
OPEN THE SCHEME TO ALL EMPLOYEES
What is the threat?
A pension scheme needs enough money to pay for existing benefits and those that will accrue in the future. Actuarial valuations of the various RPS sections indicate a shortfall (or deficit) in most sections, which means there won't be enough money to pay railway workers the decent pension they have paid for. Many employers think the solution is to implement massive hikes in employee contributions and cut back on future pension benefits. In other words, pay more and get less!
Why is this a threat?
In most sections of the RPS, employees will be expected to increase their contributions significantly. Workers could be forced to drop out of the scheme if they can't afford it. This would increase the financial burden on those who remain in the scheme, adding to the funding problems.
The workers hardest hit will be the lowest-paid, for whom any further bite out of the wage packet has a disproportionate impact.
Cutting back on pension benefits decreases the overall value, so members may see little advantage to being in the scheme. Falling membership and reduced rewards could lead to a vicious circle where the RPS disappears forever.
Why do we need to campaign?
The unions have approached the major employers in the industry. We explained to them about the problems the RPS faces but it appears to have fallen on deaf ears. So we need to turn up the volume. Every union member with a vested interest in the RPS needs to let employers know how strongly they feel. Keep up the pressure on companies to keep contributions at an affordable level.
WHY CAP EMPLOYEE CONTRIBUTIONS AT 10.56%?
This was the rate paid under the original BR scheme, before contributions were reduced after surpluses in the late 1980s. Contributions higher than this could prove too expensive and lead to large numbers of members dropping out of the RPS.
WHY KEEP BENEFITS AT THEIR CURRENT LEVEL?
Pensions are deferred pay, and like all your terms and conditions of employment, they are negotiated between the employers and the trade unions.
The cost of future benefits is not the problem. The most pressing issue is clearing the deficit created by the actuary changing his assumptions from previous evaluations, such as his views on how long we are all living in retirement.
Cutting back on pension benefits will make the RPS less attractive, which means that fewer staff will want to join the scheme and more people will drop out.
WHY STREAMLINE THE SCHEME?
Privatisation of British Rail led to the creation of one of the most complex pension schemes in the
The unions want three open sections:
- A train-operating section
- An infrastructure and engineering section
- An omnibus section.
Taxpayers - including RPS members - will save money by not picking up the bill for valuations when franchises or other contracts change. And, in an industry where workers often move between companies, an integrated scheme is simpler for workers, employers and the administrators.
WHY KEEP THE SCHEME OPEN TO ALL MEMBERS?
The more contributors to the scheme, the more people there are to build up the pension funds, so keeping the scheme open to everyone will keep it healthy and viable in the long-term. That would give all rail workers the security in retirement they deserve.
What next?
The rail unions have agreed to work together and not to enter into agreements with employers unilaterally. We have written to the government, to the trustees and to all the major employers. As employers have until the end of June to work out how to deal with pension deficits, the four general secretaries will address campaign meetings across the country. We should fight to protect our pensions:
Cherish the past.
Protect the future.
All the railway unions defending your pension scheme
Campaign meetings - all meetings commence at 18:30 except Perth which is 18:00
9 March 2006, Cardiff - Sandringham Hotel, 21 St Mary St. Cardiff, CF101PL
21 March 2006, York - National Railway Museum, Leeman Road, York, YO26 4XJ
28 March 2006, Glasgow - TGWU 290 Bath Street, Glasgow, G2 4LD
29 March 2006, Edinburgh - CWU Club, 15 Brunswick St., Edinburgh, EH7 5JD
3 April 2006, Birmingham - Birmingham & Midlands Institute, 9 Margaret St, B3 3BS
5 April 2006, Bristol - GWR Staff Ass. The Incline, Temple Meads, BS21 6QQ
10 April 2006, Perth (at the Scottish TUC) - BRSA Club, Feus Road, Perth
19 April 2006, Manchester - Mechanics Inst. 103 Princess St, Manchester, M16DD
20 April 2006, London - Camden Centre, Bidborough Street, Off Euston Road WC1. Next to Camden Town Hall, Opposite Kings Cross Station.
