The rail industry is taking steps to trim services and cut jobs in a bid to save £2bn a year as it warned that the government’s current support for the sector was “not unlimited”.
Since the beginning of the pandemic in March last year, ministers have spent over £10bn – £800m per month – propping up the industry, which saw passenger numbers collapse due to lockdown.
However, while revenue from passengers has dropped as much as 80 per cent, the costs of running the railways has remained broadly steady, creating a growing funding gap.
Now representatives from the whole industry, including Network Rail, the rail franchises, and the four main transport worker unions have joined together to “address the efficiency and cost savings required”.
The collective, which is known as the Rail Industry Recovery Group (RIRG), today released the terms of its review, which it said had the support of transport secretary Grant Shapps.
“This [funding] gap has to be addressed urgently to make the industry financially sustainable in the future”, the documents said.
“Workforce reforms and cost savings need to be identified as part of a rail industry-wide review.
“It is planned that train service levels will be curtailed, reduced or flexed in the future to align service
levels and capacity to predicted variable passenger demand with the flexibility to expand as passenger
It said rail firms would cut or reduce “duplicate” services – those “with similar calling patterns on lines of route that currently exist”.
When passenger numbers begin to grow, firms will look to make existing services carry more passengers before introducing new ones.
“Whilst these service changes are expected to have an impact on staffing levels, the actual financial
savings will vary depending on whether future train service levels increase or decrease based on actual
passenger demand”, it added.
The RMT union, which will participate in the group, said that it would fight to defend its workers from the spectre of cuts.
General secretary Mick Lynch said: “RMT will participate in the industry-wide processes and discussions as we have to be there to defend the interest of our members.
“We don’t accept the notion that the future of the railways should be based on job cuts and attacks on safety, pay, conditions and pensions.”
Currently, 30 per cent of railway operating costs are made up of staffing costs, the RIRG said.
The framework comes just weeks after the government unveiled the biggest shake-up of the UK rail network in three decades.
Under the reforms, the current franchising model will be replaced by a concession-based system, while a new “guiding mind”, Great British Railways, will take over management of the whole network.