Rail Engineering (Jobs)

Jim Shannon Excerpts

Tuesday 29th March 2011 Commons Chamber

[John McDonnell]

The reason why I raise the issue of agency workers in the rail industry is that such employment practice is becoming the norm for a number of companies. It is reflected throughout industry, and if it has now invaded the House. I find that disappointing. We as Members should take it up, because it does not seem to be a particularly cost-effective way of employing staff. The agency receives a large cut, but there is very little reward for the workers themselves.

The irony of what happened to the Jarvis workers is that, during the period in which they were laid off, the previous Government and the incoming Government were planning one of the largest railway industry expansion and modernisation programmes that we have seen for perhaps 50 or 70 years. It has happened just at a time when there is a huge job of work to be done in modernising the rail network, with the arrival of Crossrail, High Speed 2 and the electrification of the Great Western main line. We need a stable and skilled rail engineering work force and a national strategy that will retain and develop those skills, so that we can complete that modernisation and renew and enhance our rail network. In the long term, if we are to ensure that stability, we should bring renewals back in-house, back into Network Rail.

The McNulty interim report demonstrated that, when Network Rail brought maintenance in-house in 2004, there was a saving of £400 million per annum. I believe that bringing the renewals back in-house would achieve the same savings, but all the potential for the development, improvement and modernisation of our rail network will be jeopardised if we go through another Jarvis-type disaster.

I should welcome the Minister addressing several issues, and I express my gratitude to the Ministers we have met in recent months. The RMT parliamentary group, RMT union officials and the TUC have discussed with Ministers the plight of Jarvis workers and the future of rail engineering, and I am grateful to the Minister of State, Department for Transport, for writing to Network Rail to urge it to work closely with the unions and to meet members of the RMT parliamentary group. We have heard that the new chief executive at Network Rail, David Higgins, has expressed a willingness to attend a round table of stakeholders to discuss where we go from here on rail engineering.

I should like to ask the Minister here tonight to look at a number of concerns about the future. First, what is to happen to the ex-Jarvis workers who are still on the dole? Network Rail could assist in resolving some of the problems of the ex-Jarvis workers by stipulating that new contractors employ Jarvis workers or at least give them first refusal in any application for jobs. Part of the problem is that it is not clear where the former Jarvis contracts have been awarded, so it would be helpful if Ministers could intervene, asking Network Rail to identify through its Sentinel system exactly how many former Jarvis workers have been employed by contractors and how many are still out of work. In that way, we could work with them to secure their re-entry into the industry.

It would be helpful also if pressure could be put on the individual organisations—the five main companies that took over the Jarvis work—to meet the unions and other representatives of the work force to ensure that we overcome some of the outstanding claims from Jarvis’s going into administration. The companies are BAM Nuttall, Babcock Rail, Freightliner, DB Schenker and VolkerRail. In the long-term interests of the rail industry, we should do all in our power to ensure that this never happens again in this industry—that we never go through another collapse of a company when all the various agencies and stakeholders just stand to one side and allow it to happen.

[Jim Shannon (Strangford) (DUP)]

Is the hon. Gentleman suggesting that what is needed is for the Government to take a direct, hands-on approach to retaining skills and ensuring that those who have lost jobs get back into work again?

[John McDonnell]

Certainly. I will come on to an idea that I have about that, which I think will interest the hon. Gentleman.

To deal with the more immediate questions about learning the lessons of how this occurred, one of the concerns expressed was about the failure by Government to apply the powers of the Railways Act, which would have protected not only the contract work that was being undertaken but the workers who were undertaking those contracts. It would be helpful if the Minister could offer interested Members from all parties a meeting with the appropriate civil servants to discuss the procedures and criteria for when Government can apply the powers under the Railways Act if companies are threatened or in danger of going into administration, so that at least we get those procedures clear in case this occurs again.

I also ask the Minister to look at the arrangements under the Transfer of Undertakings (Protection of Employment) Regulations 1981 to see how they can be amended so that we are never again in a situation in which workers are unprotected and are made unemployed, not transferred across, and then taken back on under agency conditions, and, as a result, on worse wages and with worse conditions.

I would also welcome the Minster working with us to review the protection of railway workers’ pensions. The original pension rights of those who worked for British Rail, which Members from parties across the House thought would be protected on its privatisation, have been undermined by subsequent pensions legislation—I think unintentionally so.