Rail franchises operators & contracts

23.10.18

Grayling won’t confirm halt to January fare rise, says TfL are in ‘deep financial difficulties’ due to Khan’s fare freeze

The transport secretary has failed to confirm whether rail passengers struck by disruption will not have their train fares increased, arguing that TfL are now in “deep financial difficulties” as a result of mayor Sadiq Khan’s fare freeze.

Speaking to the Transport Select Committee yesterday, Grayling said he “can’t comment yet” on what TOCs plan to do regarding the annual fare increase by 3.2% set to come into effect this January, arguing that the important thing was to get compensation to passengers who were hit by major rail disruption due to new timetables in May.

Many critics were left furious with the announced increase following one of the worst performances of the railways – particularly from TOCs Northern Rail and GTR – that left the companies granting up to a month’s worth compensation to passengers who were left stranded on platforms.

“What we judged was the important thing was to get compensation to those passengers quickly. If you look at the package that has been provided to those affected a month’s free travel plus delay repay is almost equivalent to 10% of their annual travel,” Grayling said.

“I can’t comment yet on what the train companies will choose to do, and there are broader issues around train fares including the whole question of CPI and RPI. If you said to me what is the appropriate response to what happened, the summer of disruption was unfortunately a diversion of what was supposed to happen and is now happening, for both Northern and GTR are running more services than they did before May.”

When pushed by committee chair Lillian Greenwood on whether passengers will see a fare increase early next year, Grayling said: “Fare freezes permanently sucks money out of the industry. You could take a one-year and take a block of money and say we’ll freeze fare rises and cover this, but then you’ve got to find the same amount of money the year after that and the year after that.”

The transport secretary went on to say that TfL are in “deep financial difficulties” due to a four-year fare freeze on all services introduced by Khan in November 2016.

“We’ve looked very carefully at the implications of freezing fares, the real issue around freezing fares—you just have to look at what is happening for TfL now with their partial freeze. TfL is in deep financial difficulties at the moment, and not simply because of the challenges of Crossrail.

“We have to take some choices—the costs do rise, staff do get pay rises, fuel costs go up, do you freeze fares and either accept service cuts or the tax payer has to pay more, or do you accept that there will be increases in fares but you try to keep them down as far as possible.”

A City Hall spokesperson said: “Sadiq makes no apologies for freezing TfL fares for four years and introducing the unlimited Hopper bus fare after fares rose by 42% under the previous mayor.

“The fares freeze is helping protect passenger numbers on the TfL network – which are falling much faster across the rest of the UK – and pales into insignificance next to the £700m per year of government cuts to the TfL grant.”

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Image credit: Kirsty O'Connor, PA Images

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