Latest Rail News

08.10.12

Rail fare increases to be capped for next two years

Prime Minister David Cameron has announced that rail fares will be capped at RPI+1% for the next two years, despite ministers reiterating in June that it would remain at RPI+3% as planned.

The original formula had been set out in the 2010 spending review and was intended to begin this year, although then-transport secretary Justine Greening campaigned for it to be reduced to inflation plus 1%.

The cap applies to regulated rail fares, and the same formula will apply to London buses and the Tube.

The average rise in rail fares is now expected to be 4.2%, rather than 6.2%, although train operators can still charge above this amount for some tickets as long as such fares are balanced by cuts to other ticket prices.

The DfT said the reduction had been funded from savings identified in the department's budget.

Bruce Williamson from the campaign group Railfuture said they were “delighted” that the Government had “seen sense”.

Shadow transport secretary, Maria Eagle, called the U-turn “humiliating” and said: “The Government has spent two years claiming that these eye-watering fare rises were essential to fund investment despite the National Audit Office warning that they were just as likely to boost train company profits.”

A spokesman for ATOC said: “The Government’s change in policy is a positive move for passengers because it will mean lower than expected fare rises. All the extra money that ministers had instructed train companies to raise through the planned, higher increases in regulated fares would have gone to the Government.”

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