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Rail union threatens strike over pension changes

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  • Rail union threatens strike over pension changes

UK - Around 7,000 UK railway workers are being encouraged to vote in favour of industrial action as unions claim Network Rail is planning to introduce a "two-tier" pension scheme for workers.

The Transport Salaried Staffs' Association (TSSA), the second largest rail union in the UK, has opened a strike ballot for members employed by Network Rail after it argued new members will be offered "inferior" pension benefits under a new scheme.

Gerry Doherty, TSSA union general secretary, said: "Network Rail is effectively trying to introduce a two-tier pension scheme. They are asking older staff who used to be with British Rail to pay more to ensure that their present final salary scheme continues."

But he added: "New recruits are banned from the scheme for five years and are then being offered inferior benefits to long-serving staff. It is unfair and we will not accept."

The decision to ballot for strike action follows ongoing negotiations between the trade union and Network Rail after the most recent valuation report of the Network Rail section of the RPS showed a funding level of 97%.

TSSA said in December that guidance from the RPS trustees called for arrangements to correct the 3% deficit within nine years, and Network Rail's preferred option was:

to introduce a number of measures including application of cost neutral early retirement factors for future service from 1 July 2009; to remove favourable early retirement terms for deferred pensioners, and removal of salary subsidy on transfers-in from other sections of the RPS.

Details published by TSSA at the end of 2008 showed the changes mean protected staff would pay 13.4%, 2.88% more in contributions than non-protected staff, to maintain their final salary pension from age 60.

However, Network Rail claimed both the RMT and Unite trade unions have accepted the proposed Railway Pension Scheme (RPS) changes, which have also been accepted by the Network Rail Pensions Committee and the RPS Trustees.

The company pointed out the changes are in line with recommendations from the independent Railway Pensions Commission and also argued the trade unions strike ballot is pre-emptive as the formal 60-day consultation process has not yet ended.

A spokesperson from Network Rail said: "We will continue to talk to the TSSA to avert any potential action. Detailed and robust contingency plans are in place that will mean train services will run as normal even if a strike of the TSSA membership does go ahead."

If you have any comments you would like to add to this or any other story, contact Nyree Stewart on + 44 (0)20 7261 4618 or email nyree.stewart@ipe.com

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