Posted 20th October 2010 | 1 Comment

Rail fare increases to hit RPI+3% from 2012

THE Chancellor has announced that rail fares are to be allowed to rise more quickly, but not for another two years. The 'cap' on regulated fares is to remain, but becomes RPI + 3 per cent for three years from 2012.

George Osborne said transport would receive capital investment of £30 billion for roads as well as railways over the next four years.

The Association of Rail Operating Companies said the government would receive the additional revenue from higher fares, rather than operators, but a spokesman could not explain how this would be achieved.

More recent franchises typically enter the protection of 'cap and collar' clauses from their fourth year, in which the DfT gains from higher-than-predicted revenue, but older contracts, such as c2c, are unlikely to be included in this.

The ATOC spokesman agreed that existing franchise contracts could not be changed without the consent of both parties.

Reader Comments:

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  • H. Harvey, Birmingham

    Yes there are some good points for rail in the CSR.
    Despite Mr Hammond and Co repeating the mantras 'the pain will be shared out' and 'there are no no go areas'
    The pain that the rail system and its users are already obvious in the form of increased fares (reduced subsidies) and delay in announcement/scrappinng of main line electrification.

    Where is the share of this pain for road users? Some road schemes have been cancelled but new ones have been added.