Railway Pensions Commission – EC Statement

20 March 2008

ASLEF’s executive committee (EC) has been considering the final report of the Railway Pensions Commission (RPC) and has now issued this statement. The EC has taken advice from actuaries and pension experts in order to make a fully informed decision about the union’s response to the report.

 

The Background

 

After actuarial valuations were released to ASLEF in late 2005, the union was concerned to find that the Railway Pension Scheme (RPS) funds were in deficit to the tune of around £600 million. Because of concerns over the rising costs and the debts of the scheme, ASLEF met the General Secretaries of TSSA and the RMT to discuss the matter in December 2005.

 

The unions jointly met the major employers in the industry and were disappointed with their responses. The employers had previously benefited greatly from contribution holidays during periods of surplus. The split of this benefit was 60/40 in favour of the employers - as they claimed they would be required to pick up any future deficit.

 

In early 2006, ASLEF agreed to a joint campaign that would make four key demands. These are:

 

  • Limit employee contributions to the Railway Pensions Scheme to 10.56%.
  • Ensure that current benefits are protected;
  • Streamline the scheme: create a pensions section for the TOCs, one for engineering and another for the rest of the industry as the first step towards the re-creation of a unified industry wide scheme
  • Allow new entrants to become members of the scheme.

 

After several unsatisfactory meetings with employers, the TUC - in an attempt to resolve the issue - suggested a Commission to look in to the scheme. Both the employers and the unions decided to support the establishment of the Railway Pensions Commission

 

 

The EC’s Reaction to the RPC Report

 

The EC is very concerned that none of our four points (above) have been accepted or even referred to by the Commission. We will not be bounced into making a quick decision on an issue that will have an enormous effect on our members during their working lives and in retirement. The union must have time to properly consider the proposals and decide upon the right decision for our members.

 

Whilst the EC are continually told that the RPS in crisis, ASLEF has yet to see the figures and statistical evidence to prove this. Until the union is shown evidence that changes are needed to the current scheme, there can be no reason for us to jeopardise the existing pension our members receive. The union is therefore happy to continue to talk, but until evidence of the conditions of each fund are produced, we are negotiating in a void.

 

It is import that our representatives who are about to enter negotiations on the pension scheme valuations negotiate on the basis of our four points. They will not enter discussions on the proposals of the Pensions Commission Report until they are advised to do this by the EC.

 

. We will not follow red-herrings that will not benefit our members. It is important to remember that when franchises are bought by the TOCs they are aware of their pension obligations - and therefore have responsibility to continue to supply the pensions that staff are entitled to.

 

The EC are also aware of the dangers of negotiating long-term schemes with companies who may only have a year or two left on their franchise. The current scheme has been in place for 40 years – so that the very moment our members can benefit from it, they seek to take it away! Many of the companies we are dealing with have been around for a fraction of this time. There is little interest in long term arrangements for a company that knows that it will not be around in a couple of years.

 

The EC wants to assure members that

 

  • We will not be pressured into a new scheme that saves the employers money and costs train drivers in their retirement.
  • We are happy to continue negotiations..
  • We will continue to fight for a final salary pension scheme.

 

Until the employers are able to demonstrate to us - with hard evidence and facts - that our position must change, we will continue to call for these four points. Until and unless we advise any change in this position, the union will negotiate on the four points outlined overleaf

 

ASLEF’s position is Pensions are not a luxury. They are deferred wages. They are owed to our members.

 

 

KEITH NORMAN

 

General Secretary

 

on behalf of the Executive Committee

 

 

A copy of this statement will be inserted into each copy of the forthcoming (April) ASLEF Journal.

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