Published: 14th January 2014
The annual rise in rail fares is about to take place and the Government has stepped in to reduce the increase changing its own policy. It was announced on December 23 that the new fares applicable from January 2 were now available at ticket offices and online.
The rail industry has said that the average rise when every fare is considered will be 2.8%, the lowest overall increase in four years.
This follows the announcement by The Chancellor on December 5 that the average increase for regulated rail fares would follow the July Retail Prices Index (RPI) as opposed to the previously planned RPI+1% formula.
As is usual when politicians get involved in the operation of the railways, the law of unintended consequences kicks in. The reason the fares’ increase is set in August is to allow the train companies to prepare their systems for the new ticket rates. When the Chancellor announced on December 5 that the established formula had been amended, train companies and Transport for London (TfL) who set fares within London, were forced to change their fares at short notice.
This is not a simple task and although many fares will change from January 2 as planned, fares for journeys wholly within London will not change until January 19 which is the earliest date TfL can reset the new fare levels in its systems. These new London fares and travelcard rates will be available to passengers from January 10. This could mean that London passengers save a lot on their annual season tickets or travelcards, its worth checking if you are one of these people.
Michael Roberts, director general of the Rail Delivery Group which speaks on behalf of the rail industry, said: “We strongly support the Government’s decision to introduce a real term freeze in the average price of Season tickets next year. The lowest increase across all fares for four years shows the industry's determination to maintain the phenomenal growth in rail travel since the mid-1990s.
“Nobody likes paying more to travel by train, particularly to go to work, but billions are being spent to serve passengers better. While major projects like the new King’s Cross or Birmingham New Street stations are plain for all to see, work has also been proceeding with thousands of smaller, less visible schemes to improve tracks, signals and tunnels. Investment in new trains has improved passenger comfort and helped make possible 4,000 more services a day than in the mid-1990s.
“According to European Commission research published last week, rail passengers rate the UK’s railway the best major network in Europe, but we will not rest on our laurels. Over the next five years, at least £24billion more will be spent improving the rail network. And the rail industry is working hard to get more for every pound we spend, allowing government the scope to hold down fares in future years should it choose to do so.”
The taxpayer owned East Coast Trains (ECT) has announced that it will freeze over 50% of its fares involving London from January 2. The train company is currently being refranchised with bidders preparing their bids for the DfT to consider and the new owner will take over before the next General Election in May 2015.
This fares freeze will mean that bidders will need to factor in less revenue as a result which could mean their bids generate less return for the DfT.
ECT says that fares on 43% of all their passengers will be frozen while fares on advance tickets will be frozen for 64% of all journeys. The ECT overall average fares increase is 1.21% which if inflation is considered, some would suggest is a cut in the cost of a rail ticket.
ECT says “is a commercial decision to encourage further passenger growth, maximise revenue and market share – while helping customers and businesses across the route.”
ECT Managing Director Karen Boswell said: “We’re freezing fares to help our customers and encourage more people to travel with us. This will help us to continue to grow our business, and to give back even more to the taxpayer.
“This is a straight forward commercial decision which is very good news for our customers and businesses across our route. It will also help East Coast to sustain our strong advantage in a highly competitive travel market.
ECT’s biggest travel market is to and from London. Fares on 53% of all journeys to or from London made by East Coast customers –will be frozen including all First Anytime fares, Standard Anytime fares to London and most Advance fares. Fares on 43% of all journeys made by East Coast customers will remain unchanged. All ‘Anytime’ fares for journeys between stations across the ECT route and London will also be frozen
Virgin Trains will be increasing fares from January 2 by an average of 3.3% but their cheapest tickets are being frozen, their Standard Advance and First Advance fares.
Graham Leech, Executive Director, Commercial said “I wanted to let you know personally that we will be increasing fares on our services by an average of 3.3% from 2 January 2014. This is never a decision we take lightly, particularly during these straitened times, but we do need to continue making improvements for you, our customers.
Recent investments include £10 million to brighten up the interiors of the Voyager and Pendolino train fleets and £3 million to improve the customer facilities at many of our stations.
This December we introduced a new timetable that includes new, hourly services direct from Coventry, Birmingham International and Sandwell & Dudley through to North West England and Scotland. Additional trains are now serving Crewe, providing many more connectional opportunities at one of the UK’s iconic railway junctions.
I am pleased to say we are freezing the prices for our cheapest tickets at 2013 prices, specifically the two lead-in Standard Advance fares and the first lead-in First Advance fare. We are consistently rated as the best long-distance franchise operator for ‘value for money’ in the independent National Passenger Survey.
The average price paid by Virgin Trains’ customers has gone down during 2013 in real terms, and the number of people choosing to travel with us continues to grow – up by 3 per cent this year.