Network Rail Pension Scheme –2013 Actuarial Valuation & Ending of Contracting Out Proposals

My Ref: MRP 1/8/3                                            22nd October 2015

                                             Circular Num: NP/208 /15
To: The Secretary All Branches & Regional Councils

Dear Colleagues,


I refer to Circular NP/034/15, 3rd March 2015, as result of the RMT successfully arguing that the pension proposals above should be separate from the recent pay negotiations, discussions have been ongoing.

As you recall Circular NP/13/15, 26th January 2015, outlined that under Government legislation which will be introduced in April 2016 employers will be able to recoup their National Insurance Contribution rebate without the need of trustee consent or indeed agreement with trade unions.

This means in the case of Network Rail, management would be able to claw back their expected increased payroll costs of £24 million per annum without having to reach agreement with the RMT. Therefore the employer could with a free hand increase member contributions or change future service benefits to recoup this money.

You will also recall management had proposed, as an example, to increase the retirement age of the RPS from 60 to 67 so that it was in line with the normal state retirement age. This was totally unacceptable to the RMT.

Following a number of meetings, management have proposed to change the present pensionable pay cap from RPI + 0.5% to a flat rate RPI from 1st April 2016.  

Please note that a cap on pensionable pay increases of RPI would not prevent your union from reaching, where possible, pay agreements that are above the rate of RPI in the future.

This proposal would allow Network Rail to recoup some of their National Insurance Contribution rebate without the need of changing members’ future service benefits or increasing their contributions.

The General Grades Committee recently invited our Network Rail Area Council Representatives to a briefing meeting which took place on 15th October. The meeting was well attended and gave our representatives the opportunity to ask questions and give their views to the pension proposals being made.

A report was placed in front to the General Grades Committee on 20th October where the following decision was made:

“Referring to our Decision No G860, 13th August 2015, we note the meeting has taken place with our Area Council Representatives and the decision taken was to accept the proposal.

We therefore instruct the General Secretary to advice Network Rail of our acceptance of the proposal.

Branches and Regional Councils to be advised.”

I would like to add that as a result of this proposal our Network Rail members’ pension contributions and retirement benefits will not be altered.

I will keep you informed of any developments.

Yours sincerely,


Mick Cash
General Secretary