Circular No. NP/126/15
15 July 2015
TO: ALL BRANCHES, REGIONAL COUNCILS,
REGIONAL OFFICES, COUNCIL OF EXECUTIVES & HO OFFICERS
Dear Members,
RMT PAY BULLETIN: July 2015
Headline forecasts
Inflation rate: Average new forecast
June 2015 RPI inflation (change in cost of living relative to same time one year earlier) was 1%
For the final three months of 2015, annual RPI (according to the latest forecasts) will rise to 1.3%
For the final three months of 2016, annual RPI (according to the latest forecasts) will rise to 2.8%
Average earnings growth: Average new forecast
Over the course of 2015, average earnings are predicted to increase by 3%
Over the course of 2016, average earnings are predicted to increase by 3.4%
What crisis? Some directors of transport sector companies receive 70 - 90 times ordinary workers’ pay
At the start of the financial crisis, the difference between director and average employee pay seemed
to narrow. However, since then, the difference has reached record proportions. For example, a Mitie
Group director recently received remuneration over 90 times the pay of an average Mitie employee.
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Forecasts in detail: RPI inflation1
Predictions for RPI inflation made by a range of forecasters are:
Q4 2015
Average forecast (non-City): 1.4%
Average new forecast: 1.3%
Average forecast (City): 1.5%
Highest recent forecast: 1.9%
Lowest recent forecast: -0.2%
Median recent forecast: 1.5%
High RPI Q4 2015 forecasts to quote to employers in pay negotiations are:
Société Générale (1.9% - forecast made in June), Nomura (1.9% - forecast made in May), ING
Financial Markets (1.8% - forecast made in July), IHS Global Insight (1.8% - forecast made in July)
Q4 2016
Average forecast (non-City): 2.8%
Average new forecast: 2.8%
Average forecast (City): 2.8%
Highest recent forecast: 3.6%
Lowest recent forecast: 1.5%
Median recent forecast: 2.8%
High RPI Q4 2016 forecasts to quote to employers in pay negotiations are:
Nomura (3.6% - forecast made in May), ING Financial Markets (3.5% - forecast made in July),
Oxford Economics (3.2% - forecast made in July), Economic Perspectives (3.2% - forecast made in
June)
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The average of forecasts generally predict a modest rise or fall. While forecasts can be useful in identifying trends, the data
should not be relied on overly - the economy is complex and no model can anticipate what will happen in all circumstances.
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Forecasts in detail: Average earnings growth
Predictions for average earnings growth made by a range of forecasters are:
2015
Average forecast (non-City): 2.7%
Average new forecast: 3%
Average forecast (City): 2.7%
Highest recent forecast: 3.5%
Lowest recent forecast: 1.9%
Median recent forecast: 2.7%
High average earnings growth forecasts for 2015 to quote to employers in pay negotiations are:
Credit Suisse (3.5% - forecast made in July), Fathom Consulting (3.3% - forecast made in July),
Oxford Economics (3.1% - forecast made in July)
2016
Average forecast (non-City): 3.3%
Average new forecast: 3.4%
Average forecast (City): 3.4%
Highest recent forecast: 4%
Lowest recent forecast: 2.4%
Median recent forecast: 3.3%
High average earnings growth forecasts for 2016 to quote to employers in pay negotiations are:
Citigroup (4% - forecast made in July), ING Financial Markets (4% - forecast made in July),
British Chambers of Commerce (4% - forecast made in June), Nomura (3.9% - forecast made in May)
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Recent RMT Settlements
Company
Award
Effective From
Train Operating Companies
Chiltern Railways

2.4% increase
allowances
First TransPennine
Express

2.5% (2nd year of deal)
including minimum increase of £500
East Midlands Trains
(Customer Services
and Engineering
Grades)

2% increase to base rates and allowances
1 April 2015
Southern (Drivers)


3.34% increase (salary will rise to £47,500)
3.16% increase (salary will rise to £49,000)
2 Aug 2015
3 April 2016
to
basic
salaries
and
1 April 2015
1 April 2015
Train workshop and maintenance
Harsco Rail

2.4%, including to London Allowance and
South East Allowance
1 Jan 2015
Globalforce (Ashford,
Hitachi contract)


2.5% increase to current hourly rate.
Premium hourly rate (nightshift) for train
cleaning will be £7.69
22 June 2015
Amey

2% increase - will be made up of RPI + 1%
with a minimum of 1% and a maximum of
3%. For those on the lowest pay, there is to
be a £500 minimum rise to be applied if this
is greater than the % pay rise
Jan 2016 RPI + 1% with a minimum of 1%
and a maximum of 3%. £500 minimum rise
Jan 2017 RPI + 1% with a minimum of 1%
and a maximum of 3%. £500 minimum rise
1 March 2015


1 March 2016
1 March 2017
London Transport and other Metro
Keolis Amey
Docklands
Year One


2% pay increase, including for allowances
Those with a salary of less than £30,000 will
receive a minimum increase of £750
1 Jan 2015 – 31
March 2016
Years Two & Three


An increase of March RPI + 0.25%, with a
guaranteed minimum increase of 1.5%
To reflect the movement of the pay
anniversary date, one additional day’s leave
will be given in 2016 to each member of staff
employed on 1 Jan 2016. This extra day of
leave applies to 2016 only and is equivalent
to 7 hours.
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Buses
Stagecoach East
Midlands Drivers
(Mansfield &
Worksop)




Grade 1 (more than 1 year’s service):
increase from £9.50 to £9.75
Grade 2 (less than 1 year’s service):
increase from £7.90 to £8.10
2 August 2015
Grade 1 (more than 1 year’s service):
increase from £9.75 to £10.00
Grade 2 (less than 1 year’s service):
increase from £8.10 to £8.30
31 July 2016
Cleaning and catering
Axis Cleaning &
Support Services
(Arriva Trains Wales
Contract)

2%
1 Oct 2014

2.5%
1 Oct 2015

2.5%
1 Oct 2016
Recent non-RMT settlements
Company (Sector)
Crown Paints
(Manufacturing)

3%
Award
Effective From
1 April 2015
BMW – Hams Hall
(Manufacturing)


3.5%
0.5% on bonuses
1 April 2015
ISS - Woolwich
Hospital contract
(Healthcare)

8.7%
1 April 2015
Thorn Lighting
(Manufacturing)

3%
1 May 2015
London United
Busways (Transport)

5%
1 May 2015
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Why we use RPI and not any other measure of inflation
RPI, which includes housing costs and excludes high earners’ spending, is the only inflation measure
to use for negotiating pay (though referencing average earnings is also recommended for the coming
period).
RPI is also used to calculate index-linked government bonds, privately issued index-linked bonds,
National Savings and Investments, Corporation Tax, Business Rates, Alcohol Duty, Tobacco Duty,
Gaming Duty, Air Passenger Duty, Vehicle Excise Duty, Climate Change Levy, car and van Fuel Benefit
Charge, regulated rail fares, regulation of water and sewerage charges, indexation of British
Telecom’s wholesale charges and interest payments on student loans.
CPI is designed for comparing different EU countries’ economic performances and not for internal UK
purposes. It excludes housing costs (though includes stockbrokers’ fees and foreign students’
university tuition fees), is calculated to a mathematical formula less responsive to price fluctuations
and doesn’t adequately reflect changes to ordinary workers’ cost of living: so says the Royal Statistical
Society.
Any attempt by an employer to link a pay award to CPI inflation must be refused and should be
logged with the union’s National Policy Department.
Yours sincerely,
Mick Cash
General Secretary
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