...as unions insist on big pay rises

TRADE union bosses have rejected pleas to help limit fare increases for passengers by reining in their inflationbusting pay demands for rail workers.

Transport Secretary Chris Grayling wrote to union general secretaries on Tuesday, suggesting pay rises should be based on CPI inflation rather than the higher RPI figure, which has been widely discredited.

Mr Grayling said this is essential to meet government plans to limit rises in regulated rail fares such as season tickets in future by pegging them to CPI instead of RPI.

Unions have hit out at the latest fare hikes and have said ticket prices should be cut.

But asked how this could be squared with insisting on above-inflation pay rises for rail workers, Mick Whelan, the general secretary of drivers’ union Aslef, told BBC Radio 4’s Today programme: ‘Well unfortunately I’m from a trade union. Why would we accept pay cuts?

‘So if the cost of living goes up by RPI, which it does, we would be effectively be tying ourselves to pay cuts in future.’

Mr Whelan also described the Transport Secretary’s focus on rail workers’ wages as ‘smoke and mirrors’ as they account for less than a quarter of the industry’s costs.

The RPI measure of inflation – which is calculated differently to CPI and includes housing costs such as mortgage interest payments and council tax – has been described as flawed by Bank of England governor Mark Carney and the Office for National Statistics. Both have argued it should no longer be used.

But the RMT union accused Mr Grayling of trying to cap pay rises and blame workers for high fares, saying: ‘We will not tolerate any effort to undermine our members’ pay and conditions. We will be looking for pay increases on Network Rail, London Underground and train operators above RPI.’

Mr Grayling said he was ‘very disappointed’ at the reaction from the unions and described his suggestion of limited pay increases as ‘entirely fair’.