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Osborne: Rail fares for 2015 to rise by inflation only

Rail fares for 2015 have been frozen in real terms, following an announcement by Chancellor of the Exchequer George Osborne that fares would increase only in line with inflation, rather than the RPI +1% (RAIL 756).

For the second year in a row, rises for regulated fares - namely season tickets and off-peak inter-city return tickets - have been capped at inflation, with no regulated rail fare set to rise by more than 2.5% in 2015, taking 3% off the maximum increase. The decision extends the freeze that was introduced in the 2013 Autumn Statement.

“Support for hard-working taxpayers is at the heart of our long-term economic plan. It’s only because we’ve taken difficult decisions on the public finances that we can afford to help families further,” said Osborne on September 7.

“I can announce that no regulated rail fares will rise by more than inflation in 2015, which together with last year’s freeze will save season ticket holders around £75 over 2014 and 2015.”

In addition, train operating companies will no longer be able to increase individual fares by up to 2% more than the permitted average increase (a mechanism known as the ‘flex’). This marks a reversal in government policy, after former Secretary of State for Transport Philip Hammond reintroduced it in 2011.

Passenger Focus Director David Sidebottom said the capping of rail fare rises by inflation was “welcome news to passengers in England”, especially for commuters.

Sidebottom also welcomed the removal of the ‘flex’ mechanism.

“It is something we have been pushing for, for several years now, and we are pleased that the Government has recognised the need to act to relieve the burden on passengers.”

Shadow Transport Secretary Mary Creagh said that commuters would take the announcement “with a pinch of salt”.

“David Cameron’s Government has hit passengers with inflation-busting fare rises of 21% since 2010, adding to the cost of living crisis,” she said.

“The Tories have no plan for the railways. This won’t deal with the costs of their bungled franchise extensions, and won’t deliver the change passengers need.”

The decision includes London, where Liberal Democrat London Assembly Group Leader Caroline Pidgeon said the news would be “welcomed by passengers”.

Pidgeon added: “Inflation-busting fares would have been a bitter blow for most Londoners who have often seen freezes in the wages for the last few years.”

She emphasised that it was the Treasury, “and definitely not the Mayor”, who should take the credit.

“If the Mayor really took control of Transport for London’s budget, which he is responsible for, and ended waste and extravagant perks for senior management, he could be far more ambitious over fares, especially for part-time workers,” she added.

  • This news story was published in RAIL 757 on 17 September 2014

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