“Shaw Report” expected this week

“Shaw Report” expected this week

14 March 2016

RMT Press Office:

With “Shaw Report” expected this week RMT warns that privatising Network Rail could mean 15% yearly fare rises.

With the Government’s “Shaw Report” expected to be published this week, rail union RMT has warned that privatising Network Rail could result in a year on year 15% fare rises for passengers or an increased annual cost to the taxpayer of £1.4bn.
 
The figures were calculated on the basis of the mark up returned by Network Rail’s predecessor, Railtrack and also the additional costs that would be accrued by the outsourcing of rail maintenance.
Railtrack had a profit margin of 8% and today’s investors are no different and will want the same.  Bringing maintenance in-house on a not for dividend basis equates to a saving of £581 million per annum in today’s prices which is a saving current enjoyed by Network Rail under public ownership.
 
The report follows the warning of Dr John Skittle in his report “Network Rail Staying on the Right Track”
 
“full or partial privatisation will result in higher fares for passengers because Network Rail will no longer be a not-for-dividend organisation. New cash leakages to shareholders will have to be paid for by either higher fares or a higher taxpayer contribution.”
 
RMT General Secretary Mick Cash said:
 
“It has been widely trailed that the Shaw Report, expected to be published this week, is likely to give the green light to the further break-up and privatisation of the publicly-owned Network Rail. Our research shows that not only would such a move hammer down on safety it would also hit passengers in the pocket with massive increases in fares to pump up the private sector profit margins.
 
“In the week when the country is braced for even more austerity from Osborne’s budget, passengers who already pay the most expensive fares in Europe will be appalled when they find out that the real burden of delivering returns to the private sector will fall directly to them.”
 
“RMT will fight any attempt to bust apart the Network Rail operation and sell it off piecemeal in a return to the Corporate Greed and lethal days of Railtrack.
 
Ends

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