Posted 9th August 2013 | 2 Comments

Railcare payout -- but the future is still uncertain

THE REMAINING staff at Railcare in Wolverton and Springburn are being paid today, after 152 of their colleagues were made redundant as a result of the company going into administration.

Although funds have been made available for some 350 workers at the rolling stock refurbishment company, some arrears of pay remain outstanding.

The RMT and Unite have been urging the Government to intervene with an emergency cash injection, but so far without success. It has now emerged that an apprenticeship scheme is also at risk.

RMT general secretary Bob Crow said: "Not only are hundreds of jobs and 175 years of railway history threatened by the Government's refusal to assist Railcare but an award winning apprenticeship scheme, supposedly a Government priority, is now at risk as well. That is a shocking indictment on the Government's supposed commitment to the engineers of the future.

"No one should underestimate the national significance of the crisis at Railcare and the implications for rail users if the Government continue to wash their hands of this issue. Fleet refurbishment and overhaul will be delayed leaving passengers across the country facing the kind of breakdown experienced by hundreds of people on First Great Western on Sunday and also a spate of cancellations due to a shortage of rolling stock which should be passing through the Railcare depots in the coming months.

"At our meeting with Vince Cables officials  RMT has made it clear that if it's good enough for the Government to rescue and nationalise the banks at a time of crisis then it should be good enough for the oldest rail yards in the world. Network Rail already have a presence on the Railcare Milton Keynes site in their guise as custodians of the Royal Train so why can't they be given the opportunity to take over the whole operation, saving hundreds of skilled jobs and protecting the fleet overhaul programme?"

Meanwhile, Railcare's administrators BDO said that some money has been coming in.

BDO joint administrator and business restructuring partner Kim Rayment said: "Since being appointed, the Joint Administrators have been in close dialogue with Railcare’s customers to determine their anticipated future spending with the Company.

"Monies have started to be received for work going forward, and as a result the Joint Administrators are in a position to pay staff advance wages for the period between 1st and 10th August. These wages will be paid on Friday, and we are hopeful of being able to confirm further wage advances next week. Staff wages are the primary concern the of Joint Administrators.

“At present, there are insufficient funds to be able to pay staff wages in arrears for the month leading up to administration. We understand that this will have caused hardship. This is why the Joint Administrators are committed to paying staff promptly for the work they are currently doing to the extent that circumstances allow.

"The Joint Administrators are doing everything possible to stabilise the business and are in discussions with a number of interested prospective buyers, who will be able to secure Railcare’s future. We are pleased that the business has the support of its marketplace and customer support has enabled us to make these payments. We are also very grateful for the ongoing support we have received from staff at the Company.”

Reader Comments:

Views expressed in submitted comments are that of the author, and not necessarily shared by Railnews.

  • Tim, Devon

    If it were a viable business someone would have bought it already.

    The whole economy depends on banks, that's why they were bailed out.

    The economy does not depend on a small company refurbishing trains.

    Not everyone can have a job subsidised by the state, Mr Crow.

  • david holmes , lydney

    for once and only once I agree with Bob Crowe. HMG should step in they saved the Banks, they saved the ECML franchise and we need to ensure that rail manufacturing and repair stays in British hands. I am fed up with seeing rail infrastructure being sold or bought from abroad. Of course the RMT could buy it and Mr Crowe could put the unions money where his mouth is !