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for a written statement of the offer made to them, but had subsequently commented publicly that BR had dishonoured the RSNT award by attaching conditions to the offer. BR would be writing to all three unions later that day confirming its various offers and demanding further talks. The situation could therefore develop rapidly.

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discussion, the following points were made:

The increase in the BR pay offer from 7 per cent to 8.8 cent was a sizeable one. No additional subsidy would be available from public funds to meet the extra cost of this pcrease which would have to be found from offsetting savings, hence the conditions attached to the revised offer. The supplement for staff in the South East would fall on top of the increased national pay rate.

b.

arguable that BR management had handled the substance of the negotiations badly. The conditions which hed to their revised offer appeared, for

they had example, to

C.

More serious in getting its

e taking back some offers already made.

a single, convince

BR management had not so far succeeded cross to the public on the issues in

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dispute. This was partly because of a failure to put forward nagement spokesman, partly because

there

had been

to marshal

the arguments management's case. For example, e satisfactorily that it was ffer to treat more generously the TSSA, who had not taken rease in the offer to 8.8%

successfully in support the point had not been reasonable for BR's revised those union members, belonging industrial action, and that e would have to be met by offg savings or higher fare increases.

THE PRIME MINISTER, Summing up the discussion, said that the Cabinet were agreed that management's side of the rail dispute needed to be presented far more skilfully. There was a need to identify one, or at most two, credible spokesmen who could present the management view consistently aeretively, and to ensure that the Board arranged for those spolesmen to be systematically coached in the arguments to be used and the ways of conveying them. The Secretary of State for continue his efforts to ensure that BR recogn urgent action to meet these needs.

The Cabinet

rt should took

Noted with approval the Prime Minister's summing up of discussion and invited the Secretary of State for Tran to proceed accordingly.

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