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Train fares set to fall in 2010 | Train fares set to fall in 2010 |
(10 minutes later) | |
Regulated UK rail fares are set to fall by 0.4% next year after a key inflation measure remained near a record low. | Regulated UK rail fares are set to fall by 0.4% next year after a key inflation measure remained near a record low. |
Retail Prices Index (RPI) inflation was -1.4% in July, after hitting a record low of -1.6% in the previous month. | Retail Prices Index (RPI) inflation was -1.4% in July, after hitting a record low of -1.6% in the previous month. |
Increases in regulated commuter rail fares are pegged to the RPI figure, plus an increase of 1%. | Increases in regulated commuter rail fares are pegged to the RPI figure, plus an increase of 1%. |
"For the first time in a generation passengers across the country will see their fares fall," Transport Secretary Lord Adonis said. | "For the first time in a generation passengers across the country will see their fares fall," Transport Secretary Lord Adonis said. |
Last year, the July figure for RPI was 5%, meaning that rail prices this year rose by 6%. | Last year, the July figure for RPI was 5%, meaning that rail prices this year rose by 6%. |
'Welcomed' | 'Welcomed' |
In 2010, the rules on regulated fares change, with most rail companies having the limit of RPI plus 1% imposed on them. Previously, train operators have been allowed to increase individual regulated fares by as much as 6% over the RPI rate. | In 2010, the rules on regulated fares change, with most rail companies having the limit of RPI plus 1% imposed on them. Previously, train operators have been allowed to increase individual regulated fares by as much as 6% over the RPI rate. |
TYPES OF FARES Regulated fares refer to season tickets and saver ticketsUnregulated fares include cheap-day saver and off-peak returns, and some advance purchase tickets UK inflation rate stays at 1.8% | TYPES OF FARES Regulated fares refer to season tickets and saver ticketsUnregulated fares include cheap-day saver and off-peak returns, and some advance purchase tickets UK inflation rate stays at 1.8% |
"This means most regulated fares will fall in line with the national fare change, which will be welcomed by passengers," Lord Adonis said. | "This means most regulated fares will fall in line with the national fare change, which will be welcomed by passengers," Lord Adonis said. |
Regulated fares refer to weekly and monthly season tickets in commuter areas, where the Department For Transport (DFT) keeps prices in check by means of fares 'baskets' . | Regulated fares refer to weekly and monthly season tickets in commuter areas, where the Department For Transport (DFT) keeps prices in check by means of fares 'baskets' . |
Sixty percent of all train tickets are regulated fares, according to the DFT. | Sixty percent of all train tickets are regulated fares, according to the DFT. |
Two train companies, Southeastern and West Yorkshire PTE, are exempt from the change in rules. | Two train companies, Southeastern and West Yorkshire PTE, are exempt from the change in rules. |
Both will allowed to raise fares by 3% on top of the RPI rate from January to fund additional investment in services in those areas, the DFT said. | |
Rail fares have risen by 5% in real terms since 1997. | Rail fares have risen by 5% in real terms since 1997. |
Unregulated fares | Unregulated fares |
However, there are concerns that unregulated rail fares will surge as train companies seek to recoup the money lost from falling season ticket prices. | However, there are concerns that unregulated rail fares will surge as train companies seek to recoup the money lost from falling season ticket prices. |
Some rail firms have raised fares by as much as 11% recently on advance ticket purchases. First Great Western announced increases of up to 20% on some off-peak services last week. | Some rail firms have raised fares by as much as 11% recently on advance ticket purchases. First Great Western announced increases of up to 20% on some off-peak services last week. |
"We expect a wave of companies now to try and make the passengers pay for January's fares cut by jacking up the unregulated off-peak fares in September," said Gerry Doherty, head of the TSSA rail union. | "We expect a wave of companies now to try and make the passengers pay for January's fares cut by jacking up the unregulated off-peak fares in September," said Gerry Doherty, head of the TSSA rail union. |
"They will also hike first class and advance fares as well because these are not controlled by the RPI formula." | "They will also hike first class and advance fares as well because these are not controlled by the RPI formula." |
Mr Doherty also expects rail companies to raise prices at train station car parks. | Mr Doherty also expects rail companies to raise prices at train station car parks. |
There are also fears that several train companies will not be able to afford cutting the price of fares and may run into financial difficulties. | There are also fears that several train companies will not be able to afford cutting the price of fares and may run into financial difficulties. |
The BBC learned in February that the government had rejected a request from train companies to make sure fares stay rising, even in the event of deflation. | The BBC learned in February that the government had rejected a request from train companies to make sure fares stay rising, even in the event of deflation. |
RAIL PRICE INCREASES 1997-2008 1997 is the first year after the entire rail network was privatised Regulated fares, e.g. season tickets and longer-distance, off-peak fares, are capped by the government at 1% above inflation, as measured by the Retail Price Index. Prior to 2004 they were capped at 1% below inflation. Unregulated fares, e.g. most leisure fares including what used to be known as cheap day returns, and advance tickets, are not pegged to inflation | RAIL PRICE INCREASES 1997-2008 1997 is the first year after the entire rail network was privatised Regulated fares, e.g. season tickets and longer-distance, off-peak fares, are capped by the government at 1% above inflation, as measured by the Retail Price Index. Prior to 2004 they were capped at 1% below inflation. Unregulated fares, e.g. most leisure fares including what used to be known as cheap day returns, and advance tickets, are not pegged to inflation |