Merseyrail – Who pays industrial action costs? You may be surprised by the answer from the RMT union

Readers of this blog site will know that I have been keeping a close eye on the industrial dispute between the RMT union and Merseyrail/Merseytravel which has been caused by Merseytravel’s decision to confirm an order for new trains that are intended to be run without train guards.

One issue which I have not covered so far is who pays for the strikes. What I mean is who pays financial compensation to Merseyrail (the private sector train operating company) because they are unable to run a full train service on strike days? Here’s an explanation from the RMT union. My understanding is that Merseyrail agrees that this is the case but if I have it wrong please let me know.

A 507/508 EMU Merseyrail unit at Crescent Road level crossing – Birkdale, Southport.

RMT Press Office:

Merseyside tax payers and passengers to foot bill for Merseyrail revenue loss during Guard strikes.

RAIL UNION RMT today exposes documents which reveal that Merseyside tax payers and passengers are to foot the bill for revenue loss as a result of strike action on Merseyrail over plans to remove Guards from trains.

Dutch state owned operator Merseyrail will not lose a penny thanks to a deal signed with Liverpool politicians.

Instead, astonishingly, a clause in the agreement between Merseyrail and the controlling transport authority Merseytravel has shown that Merseyrail – which is which is also owned by Corporate giant SERCO – are protected from any revenue loss caused by industrial action.

The “Force Majeure” clause in the agreement says:

“The Operator shall not be responsible for any failure to perform its obligations …. to the extent that, such failure is caused by or is due to any Force Majeure Event…

“and such an event includes

“any strike or other industrial action by any or all of the employees of the Operator.”

The latest revelation in what is fast becoming a Merseytravel new trains’ scandal comes on top of the news that the profit share agreement signed by Merseytravel means Merseyrail are taking up to a quarter of all passenger fares in profits while not paying a penny for the new trains.

RMT General Secretary Mick Cash said:
“First, we learn that Liverpool’s politicians signed a deal with Merseyrail that allows the company to skim a quarter of passenger fares in profit whilst paying nothing for new trains and instead getting rid of train guards.”

“Now we find out that another part of the deal they have signed is that Merseyrail are protected from any losses as a result of industrial action and instead hard pressed Merseyside tax payers and passengers will have to pay for Merseyrail’s war on our Guards.”

“There is a growing stench of scandal surrounding the new Merseyrail trains in which the fare payer loses out, the taxpayer lose money, passengers lose the protection of train guards, guards lose their jobs and the only winner is Dutch owned Merseyrail”

“We are calling for an immediate inquiry into this whole murky deal”

Ends

Notes
The Force Majeure clause is Clause 5.4 and can be found on pages 55 – 57 of the agreement.

So lets get this straight, Merseytravel the Labour-run public sector body orders trains without guards which causes this dispute. Then public money is used to compensate Merseyrail, the private sector train operating company, who will lose business due to the industrial action. So that’s how public money is spent then?……

With thanks to Cliff Mainey for the lead to this posting.

2 thoughts on “Merseyrail – Who pays industrial action costs? You may be surprised by the answer from the RMT union

  1. Roy Connell says:

    Well done to my mate Cliff for the spot.
    Looks as if this strike has NO end if the company is getting paid by the people of Merseyside Labour party as has not said a dickie bird on this dispute, I wonder why!!!!!!!!!!!!!!!!!!!!!!!!!!!!!.

  2. John Brace says:

    Yeah, this seemed to have come about after I published the contract between Merseytravel/Merseyrail (although it may be unconnected) – but if so I’m glad it helped improve public understanding.

    I can understand the trade union feeling that the costs of industrial action should lie with the employer as a risk of doing business rather than the risk to lie (ultimately) with the council taxpayers of Merseyside (and others) who fund Merseytravel.

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