Bad news for rail commuters

Written on 20 August 2014

We came into work a little more fed up than usual after the announcement of a rise in rail ticket prices by an average of 3.5%. Ticket fares are regulated against the Retail Price Index (RPI), which last month was 2.5%, and under the formula, regulated fares can increase by RPI plus 1%. Under a ‘flex’ rule, train companies are able to raise prices by 2% above the average, resulting in a potential increase of 4.5% on some fares.

This increase will lead to many infuriated customers who claim that there are no improvements to the services; with trains constantly delayed and overcrowded, people are forced to stand during rush hour periods. Britain already has a reputation for having some of the most expensive train fares in the world and this latest increase is likely to reinforce this view.

In contrast to the inflation index used for calculating fares, the latest figures from the Office of National Statistics shows that for April to June 2014 pay including bonuses was 0.2% lower in the UK than a year earlier. With this disconnect in the numbers, there is surely a risk that some commuters will be forced into making difficult decisions about relocating their homes or moving jobs.

The original point behind regulating rail fares in relation to inflation was to protect the public from large price increases. However, over the last decade this policy has led rail prices to increase in real terms each year whilst the average weekly earnings have, according to the ONS, grown (or in some years declined) at below the rate of inflation since early in 2008.

Despite all this the figures show that the number of users of the British railways are at an all time high creating more pressure on popular routes and more angry commuters. Not what you need on a Monday morning!

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