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RPI figure to hint at fare rises

Rail commuters will get an indication this week of just how much their annual season tickets will rise in January 2015, with some fares possibly going up by as much as 5.6%.

Campaigners say fares are rising four times faster than wages and are stressing that commuters in marginal seats could hold the key to next May’s general election.

Tuesday sees the publication of the RPI inflation figure for July 2014 on which the January 2015 rise for regulated fares, which include season tickets, will be based.

The current price-rise formula is for regulated fares to rise by the rate of RPI plus 1%, which could see average fares going up around 3.6% if RPI remains at its June 2014 level of 2.6%.

Train companies also have a “flex” rule which allows them to raise some regulated fares by 2% above the average as long the overall average remains at the RPI plus 1% level. This means some fares could go by around 5.6% in the new year.

In his 2013 autumn statement, Chancellor George Osborne announced he was limiting the January 2014 regulated-fare rise to RPI plus 0%, while reducing the “flex” rule from 5% to 2%. This kept the average increase in regulated fares to 3.1%.

Mr Osborne will now face pressure to make a similar announcement in his 2014 autumn statement.

The Campaign for Better Transport (CBT) said today that fares had gone up 20.4% over the lifetime of this Parliament, with the increase likely to be around 24.7% when the January 2015 rise takes effect.

The CBT said that, in contrast, wages over the last four years had only risen 6.9%, with the cost of commuting now taking up as much as a fifth of some passengers’ annual salaries.

The CBT went on: “Many commuters live in marginal constituencies, where MPs should be aware that unsustainable fare increases during this Parliament could persuade people to vote for change in May’s general election.

“Fare changes are determined by a discredited measurement. The RPI is deemed to over-estimate inflation. Our research has shown that the Government’s practice of linking regulated fares to RPI rather than the more accurate CPI measure has cost commuters hundreds of pounds over the last decade.”

Unions forming the TUC’s campaign group Action for Rail will be holding demonstrations at rail stations across the country on Tuesday.

Mick Cash, acting general secretary of the RMT transport union, said passengers were “being lined up for an inflation-busting increase in their fares”.

The RMT is angered that the Northern Rail company has axed some off-peak early-evening tickets on some routes.

Mr Cash said: “You can bet your life that other train companies will seize on the move by Northern Rail to abolish off-peak fares, clobbering the travelling public with a double whammy that will hit them hard in the pocket while the train companies are laughing all the way to the bank.”

A Department of Transport spokesperson said: “No decisions on fare rises for 2015 have yet been taken. We understand people’s concerns about the cost of travel and the impact this has on family budgets. That is why for 2014 we reduced average fare rises to RPI plus 0% for the first time in a decade.”

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