Posted 10th April 2015 | 4 Comments

'Real terms' fares freeze expected from Conservatives


THE long-established policy of increasing regulated rail fares above inflation will come to an end if the Conservatives form a government after next month's election, according to reports.

Above-inflation increases in the past were intended to increase the proportion of rail costs paid by users while reducing the amount needed from public funds.

But the expected pledge has already been greeted with derision by political opponents, with Labour saying that the idea is 'unfunded, uncosted and frankly totally unbelievable', while the Liberal Democrats described it as 'astonishing'. However, transport campaigners are welcoming the prospect, dubbing it a 'step in the right direction'.

Mr Cameron is reported to be poised to say that "the cost of commuting is one of the biggest household bills that hard-working families face and it is something we are determined to bear down on.

"It shouldn't just be taken for granted that people across the country who get up early and come home late, spend a large amount of the money they earn travelling to and from work.

“Because of the difficult decisions that we have taken to repair the economy, we have been able to hold down commuter fares for the past two years. If elected in May, we would freeze them in real terms for the next five.

“Under Labour, commuters were hit with above inflation rises year after year. And if they got in again, the chaos they would wreak on the economy would ensure that it happened all over again.”

Rises in regulated fares, which include season tickets, have been restricted to the Retail Price Index for the past two years, while an earlier warning that fares would rise by RPI+3 per cent proved to be unfounded, with each year's rise being modified to RPI+1 percent in 2012, 2013 and 2014 after a series of policy u-turns.

In addition, the 'flex' which had allowed selected fares to be increased further so long as the official increase was maintained across a 'basket' of fares was also suspended this year.

Reacting to the expected announcement, Stephen Joseph of the Campaign for Better Transport said: "This is definitely a step in the right direction. Rail passengers have suffered inflation busting fare rises for most of the last ten years, which have far outstripped wage growth, so any commitment to end real terms fare increases is welcome. However, more is needed: we want to see flexible tickets for the army of part time workers who currently pay full fares, and more widely the whole rail fares system needs to be made simpler, fairer and cheaper."

Liberal Democrat Norman Baker, who served as a transport minister under the coalition, said: "It is astonishing that the Conservatives would now turn around and claim they are going to freeze fares. They have shown no willingness to do so in the last five years and no-one should believe them now."

Meanwhile Labour's shadow transport secretary Michael Dugher commented: "The Tories should be judged on what they've done in the last five years, not what they say they might do in the next five. The truth is Tory ministers have allowed rail fares to rise 20 per cent on average since 2010 and services for hard-pressed commuters to get worse. That's why Labour has been campaigning against the Tory inflation-busting rail fare hikes since 2010.

"The Tories were the ones who brought back the flex which enabled the inflation busting fares rises in the first place. Labour wants to see big changes on rail -- action on fares, but also an end to the failed franchises."

RMT general secretary Mick Cash added: "This latest stunt would still mean annual fare increases that would institutionalise the harsh reality that the British passenger pays the highest fares in Europe to travel on rammed out and unreliable trains."

When rail fares were increased above inflation in the past, rail operators pointed out that the inflation-related element went to the Department for Transport and did not boost their profits.

Reader Comments:

Views expressed in submitted comments are that of the author, and not necessarily shared by Railnews.

  • Lutz, London

    The best way to reduce the fares would be to eliminate the on-train staff that are no-longer need with new technology.

  • Steve Alston, Crewe

    "....shown no willingness to do so in the last five years and no-one should believe them now...."

    From a Liberal Democrat spokesman who clearly has forgotten which party has been in power for the last five years, bless him.

  • Melvyn Windebank, Canvey Island, Essex

    This announcement stretches the true meaning of " freeze," which one would expect to mean fares would not increase during 5 year period and not increase by RPI - Announcement should be " regulated fared will increase by RPI during next 5 year parliament !" .

    In addition, this format only applies to regulated fares so there is plenty of leeway for other types of fares to increase by more than RPI .

    It's a pity rail fare increases are not tied to fuel duty changes with both using same format for annual changes !

    Anyway, given the increasing number of TOCs returning a surplus to DFT rail will be in danger of becoming a cash cow for government and we don't want rail fares subsidizing road users now do we..

  • J Hutton, Oxford

    Surely the starting point for any rational discussion of fare increases should be the CPI - or RPIJ - measure of inflation not RPI which the ONS says, in effect, is not a valid measure of inflation for technical reasons and will always overstate the rate of inflation. For the detailed discussion on this see the ONS website

    (A valid and pertinent point. Thank you.--Editor.)