As a rail industry steering group is set up to see how the recommendations of the Railway Pensions Commission can be implemented, Network Rail unveiled a new scheme of its own.

 The decision to set up a steering group was taken at a meeting on 19 February attended by more than 70 rail industry ‘stakeholders’ and followed publication of a two-year review by the Railway Pensions Scheme.

Amongst its proposals, the Railway Pensions Commission suggests an end to the BRASS 2 scheme, raising of the retirement age from 60 to 65 and pension payments to be based on average earnings during a person’s whole career instead of final salary.

The steering group will be chaired by Frances O’Grady, deputy general secretary of the Trades Unions Congress, and will comprise senior officials of the four rail industry unions – Aslef, RMT, TSSA and Unite – and of the main industry employer groups. 

Atoc has nominated Hugh Dunglinson of Virgin Trains and Andy Meadows of National Express East Coast as its representatives. 

The infrastructure companies will be represented by Bernard Westbrook, human resources director of Jarvis, and the freight companies by Russell Mears, Freightliner’s finance director. Network Rail will be represented by Peter Bennett, human resources director. 

The Railway Pensions Commission’s representative is Nick Mitchell, former human resources director at GoVia.

The group will meet for the first time on 10 March.

Meanwhile, Network Rail announced what it described as “a third pension scheme, widening the choice for its 34,000 employees”.

A source close to the Railway Pensions Commission said that Network Rail’s proposed scheme was “not dissimilar” to the Commission’s earlier proposals.

NR said the scheme “will be a defined benefit arrangement, based on the average of an employee’s earnings, known as Career Average Revalued Earnings (CARE).

“This new pension gives Network Rail employees a wide choice of pension options – the best in the rail industry.”

The company said that employees would be able to choose from:

• A defined contribution scheme – a type of private pension plan with employee contributions being flexible (from 0 to four per cent).
• The new defined benefit scheme which is based on average earnings, with employee contributions of around six per cent.
• The existing Railway Pension Scheme defined benefit scheme, which is based on final salary with employee contributions presently around 11 per cent of pensionable pay.


Iain Coucher, Network Rail chief executive, said: “This is about providing our employees with the very best options when making those difficult financial planning decisions.


“Pensions are very important to our people and we want to provide great pension choices that balance cost and benefits, enabling employees to make informed decisions about their future.

“Our new CARE scheme will give everyone another option when making retirement planning decisions – an option that is a good balance between cost to the individual and the benefits it pays out.”