RMT to hold fresh talks with Network Rail amid talk of a new pay offer
The RMT union will be meeting with Network Rail on Wednesday for another set of talks ahead of further planned strike action on Thursday. Monday's talks collapsed after the union - which is asking for a 7% pay rise - rejected the offer of 2% with an additional 1% linked to job cuts. Senior figures in government tell me they believe that pay offer is about to get more generous, and there have been reports of 5%. However, sources tell me 4% is more realistic.
Ministers claim that any such offer (and most of the pay now comes from government after subsidies were required to keep the railways running through the pandemic) would only be acceptable if the RMT accepts "modernisation" in return. On that modernisation - Network Rail point to issues around being unable to introduce new technologies without union approval, having maintenance teams that cross geographical boundaries or having specialists sharing vans and equipment.
Ministers have highlighted rules around break times - in which interruptions allow workers to reset their whole break time. In response, the RMT insist they have no problem with modernisation - saying the issue is the desire to take "thousands of jobs from the industry and not pay our people properly in this cost-of-living crisis".
Although some say the optics of a one-day strike may be fine for the government - there is no question rolling strikes which shift into the summer, and may expand to include important public sector workers in health and education, are problematic for the government. Health workers in the Unison union and teachers in the NEU are waiting nervously for the pay review bodies to make their recommendations to government, and it is very likely that the final decisions are not going to match the current demands for above inflation pay. That is likely to have consequences.
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Look at Unison in Scotland, for example, where a 5% offer was seen as a "blow to health workers already struggling to make ends meet". The union has warned about staff opting for jobs in places like Amazon because of the better rates of pay. Ministers will argue that big pay rises could trigger a wage/price spiral and they could get backing from that from the reputable Institute for Fiscal Studies (IFS). Its director Paul Johnson has argued that matching inflation rates in pay offers would be inflationary. He told me: "The rather depressing thing I want to get across is there has been a shock to the world economy - affecting the prices of things we import. Which means we are going to be poorer - our incomes are going to go down. "And if we try to chase that by government spending and borrowing more this year and next, the longer-term pain could be bigger." The IFS has pointed out that a big Treasury support package to cut energy bills and offer payments to those on benefits will protect the poorest from price rises. But the unions point out that this is a one-off thing and next year they will still end up with pay slipping behind rising prices. Which is why there will be massive pressure for more Treasury spending next year, which in turn will make it harder for the chancellor to deliver the tax cuts his party wants. Meanwhile, unions point to other issues that mean they deserve an uplift - in particular the way public sector pay has performed against the private sector in the past decade. With these sectors facing real terms cuts, they argue they now deserve a rise.
Kevin Courtney, joint general secretary of the National Education Union said to me: "We need the government to act on pay for teachers and support staff in schools. We are failing to attract new teachers and losing staff from the classroom. "Pay has declined dramatically since 2010 and we can't afford another big hit on pay this September." But all of that doesn't automatically mean a summer of walk outs. The rules around strike ballots have been toughened in recent years, with a requirement for 50% turnout, and at least 40% of all those eligible to vote, voting in favour. For health workers and teachers that could be an even harder bar to cross than for rail workers, given the potential consequences of walkouts. And then there is the Labour party that has tried to walk the line of backing workers, without backing strikes. But that has become tricky today as Sir Keir Starmer's demand that shadow ministers stay off picket lines was ignored by some junior frontbenchers. Will they be sacked? I doubt it - given the message from the leader was an encouragement and not an order. But this all feels very messy for government, and difficult for Labour.