RAIL union TSSA is angry that millions of pounds are to be wiped off staff pensions in the future as Network Rail forces through an unpopular new pension scheme to save money.

Network Rail is to inform staff tomorrow that employees who join the company from 31 March 2004 will not be allowed to join their section of the railway pension scheme. Instead, new staff will have to join a new "defined contribution scheme", better known as a money purchase scheme.

This will particularly affect between 4,000 and 5,000 staff transferring from the infrastructure companies next year, as a result of Network Rail taking maintenance contracts in-house over the coming months, who are not already members of the railway pension scheme.

This means their pensions will fluctuate in value with the stock market, rather than guaranteeing a fixed amount based on service and salary as in a final salary pension scheme.

Network Rail has told TSSA that the reason for this is that company pension contributions have risen from £20m to £42m a year and this is no longer sustainable.

National negotiations officer John Munday said: "It is unacceptable that NR staff are to lose out as their pensions become tied to the vagaries of the stock exchange. This effectively means that staff pensions will be used to subsidise the rail industry.

"TSSA has fought hard to retain the integrity of the railway pension scheme throughout the privatisation process and the fight will continue. This erosion of pension rights will be resisted by our members and put growing pressure on the Government to face up to the pension timebomb."

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For further information, please contact:

Hannah Leggett, Press Officer:
Tel: (020) 7529 8052
Mobile: 07769 682806

John Munday, National Negotiations Officer
Tel: (020) 7529 8024
Mobile: 07767 682910

Notes to Editors

1. Last year TSSA won the biggest union recognition ballot there has been in the rail industry, covering 4,500 managers, engineers, technicians and other professionals in Network Rail.

2. Members who are already part of the railway pension scheme will not be affected by the changes.

3. TSSA represents 32,000 members in administrative, clerical, managerial, professional and technical jobs in the railways, buses, the London Underground, the travel trade, canals, ports and ferries, and road haulage.

NEW NETWORK RAIL STAFF TO SUFFER FROM DIMINISHED PENSION RIGHTS - TSSA