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Unions pile pressure on bosses after Labour controlled Merseyrail agree 7% pay deal

Unions hailed a “new benchmark” for pay awards last night as rail workers in Liverpool were given a 7.1 per cent rise.

Merseyrail agreed the deal with the Transport Salaried Staffs’ Association (TSSA), whose leader said that it set a path for other unions to negotiate similar agreements.

Merseyrail is one of the few franchises run without government money. It is ultimately controlled by the Labour local authority and Labour mayor.

Rail bosses described the 7.1 per cent deal as a one-off and an industry source said any prospect of it being repeated across the network was “fanciful”. The settlement is, though, the fourth such generous rise for rail workers after a 9 per cent rise for Docklands Light Railway workers and 8 per cent rises on the London Underground and Eurostar.

Talks between the RMT union, Network Rail and train operators collapsed again last night, ensuring more rail chaos today. RMT bosses have so far rejected a 3 per cent “no strings” pay rise for staff at Network Rail with a 1 per cent uplift based on productivity gains.

Manuel Cortes, general secretary of the TSSA, welcomed the Merseyside deal as “a reasonable offer” that helped to keep pace with the rising cost of living. He said that it would “demonstrate to the entire country that ministers are set on a course of needless and nonsensical intransigence”.

He said: “What this clearly shows is our union, and sister unions, are in no way a block on finding the solutions needed to avoid a summer of discontent on the railways. Rather, it is the government who are intent on digging in their heels. Grant Shapps [the transport secretary] and co would be wise to wake up and start talking seriously to our union as we ballot for industrial action on our railways up and down the land.”

Rail bosses immediately distanced themselves from the “incomparable” Merseyrail offer because the rail operator still “holds the keys to its finances”.

A senior industry source, familiar with the negotiations, said the unions should “leave the Liverpool deal at the door” and said the thought of achieving such “inflationary pay rises from train operators propped up by the taxpayer is fanciful, even by union standards”.

Boris Johnson has said that Britain will face a 1970s-style “wage-price spiral” if it gives in to the demands of unions and accepts big pay increases.

Today ministers will announce plans to repeal laws banning businesses from using temporary workers to replace striking staff. The legislation would come into force within weeks.

More than 40,000 rail workers will picket nationwide today, reducing the railway to one fifth of usual operations. As on Tuesday, the first day of the strikes, the network will only operate from 7.30am to 6.30pm.

Shapps accused the RMT of lying last night as he rejected claims by Mick Lynch, the union’s general secretary, that he had ended chances of a deal.

Announcing today’s 24-hour strike, with a third planned for Saturday, Lynch said: “Grant Shapps has wrecked these negotiations by not allowing Network Rail to withdraw their letter threatening redundancy for 2,900 of our members. Until the government unshackle Network Rail and the train operating companies, it is not going to be possible for a negotiated settlement.”

Shapps said: “I have had absolutely nothing to do with either the issuing of a letter from Network Rail, the employer, to the RMT — or any request to withdraw it.”

Network Rail sent unions a letter on Monday when talks last broke down, informing them of a formal consultation on modernising maintenance and redundancies on July 1. The letter does not mention numbers but Network Rail has said it intends to cut 1,800 jobs via voluntary redundancy and natural turnover.

Shapps said: “I understand that the letter makes no mention of 2,900 redundancies but I do know it confirmed Network Rail would be introducing desperately needed reforms for the industry after the union chose strike action instead of further talks.”

Merseyrail employs about 1,200 people, with the TSSA representing staff from guards to driver managers. The company has made a similar pay offer to RMT members, who are holding a referendum on its outcome. Neither union is striking on Merseyrail.

Scores of people have missed work meetings, had to change their plans or have been left stranded by yesterday’s travel disruption.

Jack Veitch, 27, who works in human resources, said he missed important work meetings after his train from Bristol Temple Meads to London Paddington terminated at Reading to replace a service heading to the Glastonbury festival. He had hoped to arrive in the capital at 9.10am.

“It was all running fine,” he said. “But when we got to Reading, they said the train was being re-routed to the Glastonbury stop. My frustration is that most of the people on the train were going to work.” He waited 40 minutes to catch another crowded train and arrived at his destination an hour and a half late. “The whole week has been a nightmare for us, the customers,” he said.

Wendy Beckham, 50, said she took a week off work for a holiday in London to celebrate the 50th birthday of her partner, Adam Williams. The rail disruption meant they had to cut their holiday a day short to avoid being stranded, while also paying about £500 in extra costs. Their train to Norwich was cancelled so they had to get tickets for a coach home tonight.

Beckham, an NHS worker, said: “You book these things in advance. You know the train strike is going to happen. You either lose out on the whole thing and our time off work, which is precious, or you take a risk and go.” She said they also missed a birthday meal arranged by the family because there was no way to get there. “Normally you step into the street in London and get a taxi — but they were all booked.”

Karl Thompson, an economist at the think tank, said: “The estimated £91 million cost of these strikes is almost half of the £173 million that they would have been expected to cost under 2019 homeworking levels, and almost two thirds below the £250 million cost you would have expected in the complete absence of homeworking.”

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