Condensed Minutes

Condensed Minutes

UE/GN/HJM 14

Condensed minutes

Meeting of the Railway Equipment Manufacturing
ad-hoc WorkingGroup

Brussels, 23 November 2015

Venue

European Economic and Social Committee, Rue Belliard 99, 1040 Brussels

Participants: see appendix

Apologies: Due to security reasons (terror alert level 4 in Brussels),several participants decided not to take any risk and cancelled their trip to Belgium: DanielDreger (FTM CGT métallurgie), Gerardo Cortijo Rodríguez (CC.OO industria), PedroMurat Castellano (UGT MCA) and, Franz Greil (Vienna Chamber of Labour). ChristianGarnier (FTM CGT métallurgie) had to cancel due to illness.

1.Liberalisation of railways and its consequences: British Rail as an example(Ken Usher, RMT - National Union of Rail, Maritime and Transport Workers)

See publication “The Four Big Myths of UK Rail Privatisation” published by the British Trade Unions (industriAll Europe website).

-Privatisation of British Rail led to a large number of problematic developments:

  • In total over 600 companies were created from the one single railway company in 1994. Thiscan hardly be called efficient.
  • The UK railway industry was sold to the private sector for a fraction of its real value.
  • The government guarantees profits; in case of losses/bankruptcies the taxpayer/workers have to pay (e.g. Railtrack).
  • The sector now receives more subsidies than before the privatisation (£5.4bn p.a.), while at the same time £2bn of cash leaves the companies every year to the banks and shareholders. Money is simply running from the taxpayer to private shareholders or to tax havens outside the UK.
  • 2002 re-nationalisation of the network with £30bn debt and a release to the private companies of £700 million.
  • Steep increase of fares (the highest in Europe).
  • Easing of safety regulations, dispersion of responsibilities and reduced inspections, with accidents and loss of lives as a result.
  • Constant attack on jobs, pensions, working conditions in order to increase dividends and profits. Slashing staff and outsourcing everywhere; less pay for more hours andever more flexibility.
  • Reduced number of stations and opening hours.
  • Lack of maintenance of rolling stock, outdated infrastructure.
  • Leasing of rolling stock allows banks to continue to pillage the sector.
  • Longer and less regulated franchises.

-The independent McNultyreport about “Realising the potential of GB Rail” raised the right issues but came up with the wrong solutions. It admitted that fragmentation led to an explosion of costs (due to lack of coordination)and that fares are much too high, but its conclusions mainly support the government policy in support of privatisation.

-The Labour party regularly announced the re-nationalisation of the railway sector but never moved to action.

-Supported by other trade unions, NGOs, user groups, community groups and political parties (and even football clubs), RMTcampaigned fiercely against the permanent onslaught on this public service. Various demonstrations have been organised andCharters published.

-As a result,RMT membership increased over 10 years from 54 000 to 80 000. Elected members, representatives and officers undergo an intense training programme. Thanks to this growing number of activists and the increased depth of trade union work, RMT is now much better represented in companies.

-It is very important to win the hearts and minds of the public, because this has an important impact on politicians.

-Regarding the recent attacks on trade union rights in the UK (the new Trade Union Bill which imposes a minimum 50% turnout in strike ballots, the backing of at least 40% of those eligible to vote, and strict procedures for taking industrial action), the industriAll Europe Railway Equipment Manufacturing ad-hoc WG decided to publish a Resolution in support of the trade unions in the UK in their fight against the violation of fundamental labourrights. The Resolution will be published on our website.

-Elements from the discussion:

  • The massive increase in passenger numbers throughout the UK is not the result of privatisation but of societal trends (traffic jams, limited access for cars to city centres).
  • Privatisation was not successful for freight: very limited access to the network during the daytime (priority for passenger transport), while at night maintenance has to be carried out. As a result contracts are lost, and employment is shrinking.
  • Limited risks for the private sector: the companies receive money to exploit a line and additional money from their own revenues. In this way the West Coast corridor run by Virgin is tremendously profitable. Technically speaking it is almost impossible for a railway operator to go bust. When a service doesn’t bring in enough, it just turns to the government for extra revenue support (this is provided for in law), so in a way profits are guaranteed, while it is difficult to make losses.
  • The sector mainly capitalises on commuters (in overcrowded trains) during the rush hours; there is little service after the rush hours.
  • Most of the population wants a return to a nationalised industry.
  • The biggest cost savings were made on employees: outsourcing of cleaning, maintenance, catering. Each outsourcing lowers costs e.g. DHL now takes care of the catering and pays just the national minimum wage. People are paid the minimum, but must produce the maximum. In tenders only the lowest cost is important, not the best service.
  • RMT is not in a cosy relationship with employers; it’s a permanent fight to protect labour rights. RMT can only achieve results when supported by all layers and grades in the workforce.
  • Railways have become a cash cow for investors. The sector became a state-subsidised privatised sector.

2.Conference on the future of the European railway equipment sector(verbal summary by Guido Nelissen)

On 13 October the German MEP Martina Werner (S&D) organised a stakeholder conference on the future of the European railway industry. Johannes Hauber represented industriAll Europe on the panel.

Despite having 400 000 employees, the sector is not very visible and deserves much more attention as it has a promising future in the light of urbanisation, decarbonisation of transport and the global growth of railway transport.

For Johannes Hauber it should be clear that of course we support railways as the backbone of our future mobility, but at the same time we oppose any European liberalisation policy (including all kinds of public-private partnerships which only plunder the public purse). Regarding the ambitious Shfit2Rail programme, which was presented enthusiastically by the Commission during our last meeting, it isn’t currently operational. The huge expectations did not materialise (the programme is dominated by the big companies, making it difficult for SMEs to access it).Moreover, we must accept that people in other parts of the world are also willing to build their own railway equipment, which means that we must mainly rely on our own markets. Regarding ERTMS, it is an expensive technology, not suited for regional transport, and we see behind it a hidden agenda of opening up the railway networks to private companies. Finally, the idea of a European ‘Airbus’ for the railway sector doesn’t look realistic and would lead to mass restructurings. Europe stands only for liberalisation and competition, and all the talk about the interests of the people is just cosmetic.

3.Liberalisation of the railway sector: will it shift more traffic to rail?(see pptpresentation)

This topic was postponed till the next meeting as our speaker, Franz Greil from the Vienna Chamber of Labour, preferred not to travel to Brussels for security reasons.

4.Questionnaire on the current situation of companies and of the railway industry in European countries

It was decided to complement the questionnaire with an open box for general comments on developments. An introductory sentence will also be added about the use that will be made of information received.

For some colleagues it remains problematic to fill out the questionnaire on country level (too many companies, no consolidated figures, a very disparate sector).Other colleagues promised to fill it out as soon as possible.

It was also suggested to make better use of information provided by the EWCs.

5.Market Economy Status for China (Guido Nelissen, see Policy Brief 2015-13)

Guido explained that granting market economy status to China (to be decided in the coming months) will make it much more difficult to use anti-dumping procedures against Chinese imports. The result could be that Europe will be flooded by Chinese imports with mass restructurings as a result. Some macro-economic surveys are talking about a loss of 1.5 to 3 m industrial jobs in Europe.The railway equipment sector could also be affected.

6.Country reports

Country reports were givenfor the UK, Switzerland, Austria, France and Germany. Johannes proposed the following structure for country reports:

1.Economic situation

2.Future developments

3.Orders

4.Employment

5.R&D, Engineering

6.Outsourcing, subcontracting

7.Trade union activities

France (Philippe Pillot)

-Activity is quite heavy for the moment, but hard times are expected (budgetary cuts in France).

-The market for regional trains is rather flat.

-Alstom sold its power and generator division to General Electric but retains its transport division and took over the signalling division of General Electric.

-Restructuring with Alstom Belfort: -100 jobs.

-Alstom set up production facilities in Algeria for the Chinese market. Alstom has also had an assembly line in China since 2007.

-The activities of Alstom are very much linked to orders for high-speed trains, but competitors from abroad are trying to gain access to the French market.

-Customers are increasingly asking for a local share in contracts. This will mean that more and more of the investments will take place outside France (with a negative impact on French employment).

-Investment: 30% in France, 70% in other countries. 50% of the output is exported.

-Alstom employs a total of 30 000 workers in its transport operations (the energy division having been sold to General Electric), of which 9 000 in France (= minus 600 over the last year).

Sweden (Anders Carlson)

-Investors have lost confidence in Bombardier and are forcing the company (still a family business) to take restructuring measures.

-A new holding company has been set up in England for all of the transport operations (withparticipation from the Norwegian sovereign wealth fund).

-The company is very much focused on aerospace. Transportation has always been the cash cow for financing the expansion of aerospace.

-Staff numbers at Bombardier Sweden remain stable.

-A new bargaining round has started with a wage increase of 2.8% as a target.

UK (Ken Usher)

-As the composition of the Bombardier EWC has been reviewed, it would be useful to provide training facilities for the new representatives.

-Bombardier is taking part in 5 tenders. If these are not successfully concluded, this will put Bombardier back for years.

-RMT is concerned about the role of institutional investors: they just want a return on investments and are not interested in long-term industrial strategies.

-The start-up of the Crossrail project, granted to Bombardier, will increasejobs (risk for shortages of engineers).

Austria (Georg Grundei)

-The situation of the Austrian railway industry is rather stable, and the balance sheets of most of the companies are positive.

-Next year a contract will be granted for Vienna’s underground rail system.

-We see a tendency for more and more outsourcing to China.

-A new collective agreement for the metal sector was signed:

  • 1.5% wage increase (0.8% inflation).
  • Free-time option: increase in pay can be exchanged for free time (now or later).

-Membership of trade unions is increasing.

Switzerland (Nino Stuber)

-The high rate of the Swiss franc is ruining industrial activity.

-The workload nevertheless remains quite strong for the time being (long-term orders).

-Weekly working hours were even increased (+3 hours) (to total 44 hours)

-Outsourcing to Poland and former Soviet Republics.
Germany (Johannes Hauber)

-The sector has 151 000 workers employed.

-There is nevertheless a strong trend towards outsourcing.

-Exportsrepresent over 50%.

-The financial situationatBombardiercontinues to bedramatic.Its operating resultisin the minus triple-digitrange. Theproduction lineat its Mannheim siteis to be closedanddue to be transferred toSpain, despite goodcapacity utilisation.

-Stable workload at Alstom and Siemens and the other companies.

7.Miscellaneous

The next meeting will take place in May 2016. As industriAll Europe is no longer able to pay for interpretation costs, and as the number of subsidised meetings in Brussels will be limited next year to only 8 (for the whole of industriAll Europe), we are obliged to look for an affiliate willing to host the meeting. Topics for discussion could include:

-Liberalisation of rail transport (Vienna Chamber of Labour)

-Summary of the McNulty report

-New competitors for rail: long-distance buses and monster trucks

-How to shift traffic from roads to rails

APPENDIX

Participants

INDUSTRIALL

• Guido Nelissen, industriAll European Trade Union

BRITISH REGION

UK

• Ken Usher, RMT

CENTRAL REGION

AUSTRIA

• Georg Grundei, ÖGB GPA DJP

• Michael Richter, ÖGB GPA DJP

• Leopold Sedlak, ÖGB PRO-GE

GERMANY

• Johannes Hauber, DGB IG Metall

SWITZERLAND

• Nino Stuber, UNIA / Stadler Rail Management AG

NORDIC-BALTIC REGION

SWEDEN

• Anders Carlson, UNIONEN

SOUTH WEST REGION

FRANCE

• Philippe Pillot, FO Métaux

International Trade Union House (ITUH) - Boulevard du Roi Albert II 5 (bte 10) - B-1210 Brussels

Tel: +32 (0)2/226 00 50

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