Rail fares rise limited to 2.5%
Long-suffering commuters are to be spared some of the pain of next January's rail fare rise.
This year's July RPI inflation figure had meant that regulated fares, which include season tickets, would have risen by an average of 3.5% in January 2015.
But Chancellor George Osborne announced today that he was, for the second year running, knocking 1% off the annual rise, meaning that the new-year increase will be limited to 2.5%.
He also announced that he was scrapping the "flex" system whereby train companies could raise some fares by up to 2% above the permitted average.
The announcements mean that no season ticket will rise by more than 2.5% in a move that will cost £100 million.
The Government said that, as a result, more than 250,000 annual season ticket holders will have made a combined saving of about £75 over 2014 and 2015.
Mr Osborne said: "Support for hard-working taxpayers is at the heart of our long-term economic plan.
"It's only because we've taken difficult decisions on the public finances that we can afford to help families further."
But Labour and rail unions appeared less than impressed with the Chancellor's move.
Shadow transport secretary Mary Creagh said: "Commuters suffering under the cost-of-living crisis will take this with a pinch of salt.
"David Cameron's Government has hit passengers with inflation-busting fare rises of 21% since 2010, adding to the cost-of-living crisis.
"The Tories have no plan for the railways: this won't deal with the costs of their bungled franchise extensions and won't deliver the change passengers need."
Mick Cash, acting general secretary of the RMT transport union, said: "The announcement from George Osborne does not stack up to a freeze for millions of people whose incomes are stagnant due to years of austerity.
"To try and dress this up as benefiting working people is pure fraud on the part of the Government.
"If you are an MP like George Osborne about to scoop a pay increase of 9%, then of course you can meet the soaring costs of rail travel as the tab is picked up by the taxpayer.
"Tomorrow, RMT will be out at stations across the north where some off-peak fares will double overnight."
Manuel Cortes, leader of the TSSA rail union, said: "The Chancellor has some brass neck in presenting this 2.5% increase as a good news story when it means he will have increased rail fares by a huge 24% since moving into Number 11 Downing Street in 2010.
"If he was genuinely interested in helping passengers who have seen their real wages fall over the past four years he would have actually frozen fares, not hiked them upwards again."
Michael Roberts, director general of rail industry body the Rail Delivery Group, said: "We support the Government's decision to ensure a real-terms freeze in next year's season tickets and other regulated fares.
"The rail industry will continue investing in more trains, faster services and better stations while getting more out of every pound spent."
David Sidebottom, passenger director at rail customer watchdog Passenger Focus, said: "The capping of rail fare rises by inflation will be welcome news to passengers in England, especially those who rely on the train for work, as will the ban on train companies increasing some fares by more than the average.
"It is something we have been pushing for, for several years now and we are pleased that the Government has recognised the need to act to relieve the burden on passengers."
Martin Abrams, public transport campaigner at the Campaign for Better Transport, said: "This announcement will be a welcome relief to millions of people who were finding their rail fare rise outstrip their wage rise by up to four times during this parliament.
"Hopefully it's an indication that the Government will now implement a coherent plan of much-needed investment which removes the burden from passengers.
"Fares need to be held down for the long term while wages catch up, and the inflation formula finally needs to change from the Retail Price Index to the lower, fairer Consumer Price Index to bring it in line with other measures."