12 May 2021
RMT Press Office:
As another rail company fleeces the tax and fare payer RMT calls for full inquiry into Government’s backroom sweetheart deals with Train Operators.
Britain’s largest rail Union RMT today slammed the Government for conducting backroom deals with Train Operating Companies and allowing them to break their franchise contracts with minimal termination fees following the collapse of the contracts. At the same time the Government is presenting these companies with risk free direct awards which is a “licence to print money” whilst they are preparing to pay out huge dividends to their shareholders.
First Group Plc plan to restart paying huge dividends to shareholders whilst workers across the railway face an across the board 2 year pay freeze and it has now been reported that First Group has come to an agreement with The Department for Transport on the termination of its TransPennine Express franchise for a final fee of £6m, which is around £50 million less than first assumed. Both the DfT and First Group are now negotiating a direct award to run to May 2023 (with possible extension of 2 years).
RMT General Secretary Mick Lynch said:
“It is utterly scandalous that as our heroic rail workers are facing a 2 year pay freeze these fat cat Train Operating Companies are given the green light to print money by our Government whilst paying out eye-watering dividends to their shareholders.
“Instead of taking this failed franchise into public ownership, as we have seen with other failed franchises in Scotland and Wales, and indeed with Northern Rail and LNER in England, we are seeing government scrambling to save what is left of railway privatisation regardless of the cost to the taxpayer.
“This is nothing short of a great railway racket cooked up between the Department for Transport and a small cabal of transport companies to keep the utter failure of railway privatisation on life-support whilst rail workers have their pay frozen and passengers continue to be ripped off.
“I am today writing to the National Audit office as there needs to urgent scrutiny and an immediate transparent inquiry into how these backroom deals are conducted and to ensure our railway and transport system works in the interests of passengers and rail workers and not just a small group of very wealthy shareholders.”