South West Trains is to give thousands of workers a 7.6 per cent pay increase in a bid to end the rail strikes.

The surprise move came as the second day of a 48-hour strike by members of the Rail Maritime and Transport union (RMT).

The strike continued to cause severe disruption to services across the South-East, including trains from Brighton to Reading via Chichester.

SWT said it had decided to take the initiative because negotiations were not leading to a settlement and the strike was disrupting hundreds of thousands of passengers.

The RMT executive was meeting later today and was expected to call further strikes. One official warned of an indefinite walkout.

A statement by the company said: "After exhaustive talks and four damaging strike days, SWT has decided to take the initiative by giving its staff a 7.6 per cent pay increase.

"Negotiations with the RMT were not leading to a settlement and the strikes have disrupted hundreds of thousands of passengers.

"Everyone is adamant that this stalemate cannot continue, so we have decided to conclude the 2001 pay negotiations by giving all relevant grades a 4 per cent award backdated to April, a further 3.6per cent to follow from this April and another pay review in October this year."