Pandemic profiteering has to stop

Pandemic profiteering has to stop

30 July 2021

RMT Press Office:

‘Pandemic profiteering has to stop’ says RMT as FirstGroup announce £500 million shareholder payout and boasts that new National Rail Contracts will ‘support attractive dividends’.

RAIL UNION RMT has called on the government to stop FirstGroup paying out a planned £500 million to shareholders this year, a sum it increased recently in part as a consequence of its franchise termination agreement with the government for the TransPennine Express being £50m ‘lower than anticipated’ and its new National Rail Contracts with the DfT.

The union has warned that the government’s National Rail Contracts are ushering in a new era of risk-free profiteering as FirstGroup’s investor presentation shows that it expects to pay ‘regular dividends commencing in 2022’ on the basis of an operating model it in which the balance of risk and reward has been ‘totally transformed’ freeing the company from ‘revenue risk’ and which will ‘support attractive dividends’.

The union also slammed FirstGroup for putting its objective of 10% profits from its UK bus operations ahead of passenger and community needs, citing its warning that in spite of the huge government support it has received throughout the pandemic, it may cut unprofitable routes if cash strapped Local Authorities cannot fund them.

At the same time, FirstGroup’s frontline transport workers are being callously subjected to attacks on jobs, conditions and pensions, despite their commitment and heroism throughout the pandemic.

RMT General Secretary Mick Lynch said,

“These plans expose the utter moral and financial bankruptcy of privatised transport. Our members and the taxpaying public have been through hell during this pandemic.

“So many lives have been lost, there’s been so much suffering and sacrifice and our members are told they have to do their bit for the country by accepting pay freezes, job cuts and attacks on pensions and conditions, yet here we are watching the same old sharp suits looking to sweat the system in pursuit of obscene wealth, crowing at the removal of risk from their enterprises and promising ‘attractive dividends’ to people who have done nothing but take money from the taxpayer since the pandemic began.

“Other countries have stopped dividend payments by companies receiving bailouts and as a minimum our government needs to step in to stop this payout, but it’s also time to end this grisly pandemic profiteering at public expense and take our vital transport networks out of the hands of the get-rich-quick crew.”

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Tagged with: Pandemic Profiteering, National Rail Contracts, Tory Government, Rail Privatisation