Select Committee on Transport, Local Government and the Regions Minutes of Evidence

Examination of Witnesses (Questions 407-419)




  407. Gentlemen, may I begin by apologising to you for our suspended session on the last occasion. You are very welcome this afternoon and we hope to allow you to escape with reasonable speed. Can I ask you to identify yourselves for the record?
  (Mr Rix) Michael Rix, General Secretary, ASLEF.
  (Mr Crow) Bob Crow, Assistant General Secretary, RMT.
  (Mr Rosser) Richard Rosser, General Secretary, Transport Salaried Staffs Association.

  408. Do any of you three gentlemen wish to open the batting with any general remarks? We did manage to get some of them on to the record last time. Would you mind therefore if we went straight to questions? You have suggested that workers remaining in the public sector after a PPP deal will suffer attacks on pay and conditions in order to cover any shortfalls in revenue that London Underground might find on those occasions. What are you doing to ensure that this does not happen?
  (Mr Rix) There are many things, Chair, that we have done. We have written to the Secretary of State on a number of issues, ie, pensions, such as whether there is the possibility of transfer for these people, and indeed this year some of the things that we have been negotiating with London Underground have been widely publicised in the newspapers. There were many distortions in the press but I think it would have been irresponsible for us as trade union leaders not to ensure that members who could possibly transfer would not suffer a detriment. There are a number of issues that we have tried to deal with, one of which was redundancy and redundancy protection.

  409. So we are talking about protection of pensions, terms of redundancy?
  (Mr Rix) That is right, and the compulsory offer of a job in case an individual's job is restructured or swallowed up by some other issue. There is now a guarantee that they have to offer the person another job.

  410. Is there anything else that you have gone for?
  (Mr Rix) One of the things that we have been looking at is commonality of negotiating. We have a signed machinery of negotiation with London Underground and indeed with the Infracos, so one of the things that we would like to pursue on this matter is a commonality between the three Infracos and the LUL so that pay talks, remuneration and other conditions are held jointly right across the combine which I believe will protect people and avoid the lunacy that took place in the former British Rail where there was a wholesale competition and where the highest bidder would pay the highest money, leaving shortfalls in other sectors of the industry, thus creating problems.

  411. Is there anything you want to add to that, Mr Crow?
  (Mr Crow) The situation, as Mick just said, is quite right. People are covered in Britain at the moment by TUPE. What we have done with London Underground is TUPE-plus, eg, protection of staff passes, protection of pensions, which is outside of TUPE. The problem that we are still concerned about is new entrants if PPP were to go ahead. Number one, would they still get staff passes, would they still be in the London Transport Pension Fund? What has happened with the former British Rail is that people have come into the industry without getting the same staff travel benefits, without being in the same pension fund, without having the same rate of pay, and it causes anger and resentment. What we have been trying to pursue are pilot schemes which are being operated under PPP in the National Health Service where individual contracts of employment will remain with the National Health Service and their contracts will be negotiated directly with the trade union. We would like to keep the contracts of employment with London Underground so that our trades unions TSSA, ASLEF and RMT can negotiate direct on those contracts of employment.

  412. Do you want to add to that, Mr Rosser?
  (Mr Rosser) No, I have nothing to add.

  413. What undertakings have you had? Presumably you are talking to Transport for London and London Underground?
  (Mr Crow) We are talking directly to London Underground as the employer because TfL only have that section of people that will stay within the public sector. What we have got written into the contracts of employment and also into the main contract which the Infracos will sign is that anyone made redundant will be offered another job subject to them being medically fit. If they are made redundant again they will be offered another job. That is good employment negotiations by the employer and by the trades unions, but we are still mainly concerned with a two-tier workforce out there: those with staff passes, pensions and protection of their job, and those new people coming in a minute after PPP happens on worse conditions. That to me is going to cause resentment, jealousy and bitterness around the combine.

Mr O'Brien

  414. On that particular point do you think people will accept employment on a two-tier system like that?
  (Mr Crow) A lot of people have no other option. It is either the dole queue or a job with those conditions. People obviously take the conditions they are offered, but when they come and work alongside people you start off on day one with 100 per cent of the workforce getting one set of conditions. When someone retires and someone new comes in, they start getting a small percentage of people on different conditions and over the course of five, ten, 15 years the majority of people do not have the same conditions as those people prior to the privatisation taking place.

  415. Do I take it from the response that you are accepting that under the PPP there could be substantial reductions in the project costs of running the service?
  (Mr Crow) We have not yet seen the full details of the contracts. It is at the end of the day none of our business; it is a matter between London Underground and the Infracos. Our concern is on the terms and conditions of our members and future members who come into the system. What we found with what happened on British Rail was that everyone went over and the pledge was that your terms and conditions would remain the same as on day one. If anyone had the opportunity to see The Navigators film on Sunday evening, it brings out exactly what took place in the railway network. As soon as new people are taken on you get some companies that provide exactly the same terms and conditions as those people prior to privatisation, but you get other contractors and employers out there that give conditions that are inferior to the ones there at the moment and this is what causes the bitterness, jealousy and anger, whereas people say that if you do the same job you should get the same rate of pay and the same conditions should apply.

  416. There are records with Pricewaterhouse where they are saying that through PPP there has been a 20 per cent saving in the project costs. If that is correct how can you argue that that should not go ahead, that there should not be these savings so that more money can be spent on safety and providing a service?
  (Mr Rix) What you need to look at is that we have not seen any sight of any proposed contract, so when people who are analysing these matters and making these wonderful statements nobody knows what is in these contracts or what is being proposed. In fact, what we have tried to do is find a similarity such as where you as Members have to abide by certain standards of public life. We have put forward—


  417. This might not be the day to underline that.
  (Mr Rix) No. One of the things that we have tried to put forward is that when we are dealing with public money should that not also be looked into, that there should be a standard and more openness so that we can make a balanced judgement? In some respects, with regard to what Pricewaterhouse are saying, we are not in a position to challenge these issues because we have not really seen the in-depth analysis on them. There are elements that where there have been privatisations in the past and where there have been privatisations recently, or where there has been a move under a public/private partnership, the whole essence of the new employer is to alter the conditions of employees and usually on the cheap, or reduce staff numbers. The fact of the matter is that this PPP is supposed to be about regenerating London Underground with major infrastructure changes in engineering, so we should not be looking at getting rid of staff; we should be looking at increasing staff to carry out these infrastructure projects. These companies will look at a cost basis to do it on the cheap and they will do that by agency working and through sub-contracting.
  (Mr Rosser) My recollection of the costs is that we were told that privatisation of the main railway system would reduce costs and lead to greater efficiency and we would all get the benefits of private sector management and expertise. I think there are quite a few people now who are struggling to find evidence of being able to run the railway network more cheaply and more efficiently. I would only beg of you to be a bit wary of consultants who come out with statements like this. It is why we have been asking, as I know you have as well, for transparency. Let us see the basis on which those calculations have been done. I do not swallow, I am afraid, this argument about commercial confidentiality. Surely the basis on which these bids are put in or may be accepted is far more important—and we are talking about transport in London—than this so-called get-out clause every time of commercial confidentiality.

Miss McIntosh

  418. I would like to state that my husband works for an American airline company before I ask this question. Are you aware of any other industry undergoing restructuring at the present time that would acquiesce to the type of conditions that you are asking for?
  (Mr Crow) We understand that in the NHS there are three pilot schemes going on.

  419. In the transport sector.
  (Mr Crow) Going through restructuring from public to private?

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