Rail Fare Price Increases To Be Curbed In 2014
The Government is announcing new measures to curb train operators' ability to increase ticket prices in the new year.
Rail companies are able to add an additional 5% to some individual fares - as long as the average rise of regulated fares is maintained at 1% above RPI inflation - but that will now be limited to just 2%.
This means that in January 2014, no regulated fare - which includes season tickets - can go up by more than 6.1%, with the average, as already announced, being limited to 4.1%.
With the new year rise being based on the July 2013 RPI inflation rate, which was 3.1%, some season tickets could have gone up by as much as 9.1% under the old "flexible" system.
The reduction in "flex" is part of the Government's fares and ticketing review published today by Transport Secretary Patrick McLoughlin.
"By capping fares we are protecting passengers from large rises at a time when family incomes are already being squeezed," he said.
"We will need to wait for the rail industry to calculate individual ticket prices for next year, but this cap could save some commuters as much as £200 a year."
As well as curbing the rise in fares, the review opens the door for future innovations such as the end of paper tickets, a code of conduct for train companies to give passengers the confidence that they are getting the best deal for their journey and a flexible approach to season tickets which could benefit part-time workers.
Mr McLoughlin said: "Today is just the start of a Government-wide programme to help hardworking people and reduce the cost of living.
"The Government will be announcing a range of initiatives to help put money back in people's pockets over the next few weeks.
"Alongside this, the Government is investing over £16bn to transform our rail network, which will make sure we can respond to increasing passenger demand and drive forward economic growth that will help strengthen our economy."
Anthony Smith, chief executive of rail customer watchdog Passenger Focus, said: "Passengers will be pleased to hear that the amount train companies can raise individual regulated fares by has been limited.
"We have been calling for this to happen for years - it is a step towards a fairer system.
"This will allow passengers to plan with a bit more certainty and have confidence that actual regulated fare rises will bear more relation to the figures set by government."
TUC general secretary Frances O'Grady said: "Like all these things, the devil is in the detail, but we are pleased the Government has responded to concerns raised by unions and passenger groups over ticket office opening hours and runaway fares.
"However, ministers are still failing to deal with the elephant in the room - the market failure of rail privatisation. This is wasting millions in taxpayers' money every year and is one of the main reasons why fares have become so eye-wateringly expensive."
Shadow transport secretary Mary Creagh said: "Over the last three years David Cameron has failed to stand up for working people, allowing train companies to hit passengers with inflation-busting fare rises of up to 9%.
"Far from addressing his failure, this is cold comfort for commuters - it has taken 18 months, delivers fare increases of up to 6% and is too little too late.
"This announcement doesn't go as far as Labour's plans, which would prevent train companies from increasing fares beyond 1% above inflation."
The rail fare announcement applies to England. In Scotland, the January 2014 regulated fare rise will be 3.1%, based on the formula of RPI plus 0%.
Unlike England, Scotland has no "flex", so no regulated fare can go up by more than 3.1%. The Welsh new year fare rise has yet to be announced.