Reactions to rail fares announcement

Wednesday, 15 August 2018 12:06

Train fare increases are an insult to everyone who has suffered from the chaos on Britain’s railways – Jeremy Corbyn To coincide with confirmation of the 3.2% train fares hike this morning, Labour has compared the costs on over 180 train routes between when the Conservatives came to power and the projected new prices that will be implemented this January 2019. The...Request free trial

Train fare increases are an insult to everyone who has suffered from the chaos on Britain’s railways – Jeremy Corbyn

To coincide with confirmation of the 3.2% train fares hike this morning, Labour has compared the costs on over 180 train routes between when the Conservatives came to power and the projected new prices that will be implemented this January 2019.

The average commuter will now be paying £2,980 for their season ticket, £786 more than in 2010.

New figures released today by Labour show:

That some commuters will be paying over £2,850 more to travel to work than in 2010.

The highest increase was on a Virgin Trains season ticket between Birmingham and London Euston which will have risen by £2,874 since 2010 and now costs £10,902.

The biggest percentage increase identified was between Thame Bridge Parkway near Walsall and Nuneaton, where the cost of an annual season ticket will have risen by 54 per cent since 2010.

In Theresa May’s own constituency the cost of an annual season ticket from Maidenhead to London Paddington has risen by £831 since 2010.

Average fares have risen more than three times faster than wages.

The amount by which train companies can raise regulated fares is the responsibility of the Transport Secretary Chris Grayling. He has the power to enforce this but he’s choosing not to, instead only writing a "pathetic" letter to the trade unions unfairly asking rail staff to accept a pay cap.

By making no similar request for the bosses of train companies to take a pay cut or for shareholders to refuse dividends, he is letting the train companies off the hook yet again.

Labour has committed to keeping fares down and pegged to no more than a rise of CPI. Labour has also called on the Government to freeze rail fares on the routes most severely affected by the timetable changes - Govia Thameslink, Arriva Rail North and First Transpennine Express.

Jeremy Corbyn, Leader of the Labour Party, said:

“Today’s train fare increases are an insult to everyone who has suffered from the chaos on Britain’s railways.

“The Government’s shambolic mismanagement of our railways has been a national embarrassment and they must now step in to freeze fares charged on the worst performing routes.

“Labour will take back control of our railways by bringing them into public ownership so they are run in the interests of passengers, not private profit.”

Andy McDonald MP, Labour’s Shadow Transport Secretary, said:

”This is a pathetic attempt by Chris Grayling to shift the blame for Tory fares policy. The amount by which train companies can raise regulated fares is the responsibility of the Transport Secretary. He has the power to enforce this, he’s just choosing not to.

“The Secretary of State has washed his hands of years of industrial action on the railway, saying it was the responsibility of train companies, but is now intervening over staff pay. At best this is a distraction technique and at worse a recipe for years of industrial action.

“Chris Grayling made no similar request for the bosses of train companies to take a pay cut or for shareholders to refuse dividends. The men and women who run the railway are being singled out while greedy train companies are let off the hook yet again.

“The truth is that our fragmented, privatised railway drives up costs and leaves passengers paying more for less, not staff.

“The railways need serious reform, not a plea to train companies, but Ministers are persisting with a failed model of privatisation that is punishing passengers and taxpayers. Instead, Labour would use money saved from bringing passenger services into public ownership to cap regulated fare rises at the Consumer Price Index.”

Ends

Notes to editors

The average commuter will be paying £2,980 for their season ticket in 2019, £786 more than in 2010.

The average 2017 annual season ticket reportedly costs £2,788.[1] Regulated rail fares rose by 27.1% between 2010 and 2017, which means that the average season ticket in 2010 would have cost £2,194. A 36% (from 2010-2019) increase on £2,194 is £2980.

Top 5 highest rises in cash terms

Annual Season Tickets	2010	2019	£ increase	% increase
Birmingham - London (Virgin)	£8,028	£10,902	£2,874	36%
Coventry - London Euston (any permitted route)	£7,096	£9,639	£2,543	36%
Swindon - London	£6,640	£9,020	£2,380	36%
Stoke-on-Trent - Milton Keynes Central	£5,320	£7,554	£2,234	42%
Norwich - London	£4,648	£8,425	£2,213	36%

Top 5 highest rises in percentage terms

Annual Season Tickets	2010	2019	£ increase	% increase
Tame Bridge Parkway - Nuneaton	£1,948	£3,009	£1,061	54%
Bloxwich - Nuneaton	£2,228	£3,385	£1,157	52%
Dover Priory (non HS1) - London	£1,200	£5,688	£1,808	47%
Enfield Town - London Liverpool Street	£4,608	£1,746	£546	46%
Hastings or Rye (HS1) - London St Pancras	£4,648	£6,700	£2,092	45%

Fare rises in Ministers’ constituencies

Annual Season Tickets	2010	2019	£ increase	% increase
Theresa May: Maidenhead- London Paddington	£2,360	£3,191	£831	35%
Philip Hammond: Weybridge – London Waterloo	£2,272	£3,063	£791	35%
Chris Grayling: Epsom – London Victoria or Waterloo	£1,680	£2,299	£619	37%

Season ticket data for 2010 has been taken from the Avantix Traveller (National Fares Manual) database. http://data.atoc.org/fares-data

2019 are based on a 3.2% increase on 2018 prices which have been taken from the National Rail season ticket calculator. http://ojp.nationalrail.co.uk/service/seasonticket/search

Regulated rail fares, which include season tickets and most other commuter tickets, will have risen by 36% on average between 2010 and 2019.

year	annual increase at RPI	RPI rate per cent	Cap per cent	Average indexed against 2010
2010				100
2011	RPI+1	4.8	5.8	106
2012	RPI+1	5	6	112
2013	RPI+1	3.2	4.2	117
2014	RPI	3.1	3.1	120
2015	RPI	2.5	2.5	123
2016	RPI	1	1	125
2017	RPI	1.9	1.9	127
2018	RPI	3.6	3.6	132
2019	RPI	3.2	3.2	136

· Regulated fares have risen by more than the average on some routes because Ministers decided to restore ‘flex,’ the train companies’ right to vary prices by up to 5 per cent, between 2011 and 2014.

· In September 2014 the Department for Transport introduced a new evening peak period in metropolitan areas on the Northern franchise, which raised the cost of travel by up to 162%.

· Median weekly wages grew by 10.4% between 2010 and 2017

Year	Median (Gross, £)	Annual % change
2010	498.5	2.05
2011	500.7	0.44
2012	506.1	1.08
2013	517.4	2.23
2014	518.3	0.17
2015	527.1	1.7
2016	538.7	2.2
2017	550.4	2.2

Year	% change
Year	% change
2010-2017	10.4

ONS, Annual Survey of Hours and Earnings 2017, 26 October 2017,https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/annualsurveyofhoursandearnings/2017provisionaland2016revisedresults#average-earnings

Background note from the Conservative Party

Rail fares increased above inflation under the last five years of Labour, rising 11 per cent in their final year in office. Average rail fares rose faster than inflation every year from 2005 to 2009. The average annual fare rise in Labour’s last five years was 5.1 per cent. Meanwhile, since 2010, rail fares have increased at a lower average rate of 3.3 per cent a year (They work for you, Col 1355, 19 January 2016, link; ORR, average change in price of rail fares, link).

· This is the sixth year in a row that we have capped regulated rail fares to inflation. By capping regulated fares, this means rail fare users have been protected from above inflation rises (BBC News, 16 August 2016, link; The Guardian, 11 August 2018, link).

· But, in order to help commuters keep more money in their pockets, the Transport Secretary wants to move costs in the industry to the lower rate of inflation. Income and expenditure in the rail industry must both use the same rate of inflation, meaning fares and wages must use the same rate. Chris Grayling has written to the rail industry and the unions asking for their help to move the costs in the industry to the lower rate of inflation. With their help we can keep fares for passengers as low as possible without asking all taxpayers to pay for it. (Financial Times, 14 August 2018, link).

Currently, around 98p in every £1 spent from fares goes back into the railway, helping ensure that the cost of the biggest investment since Victorian times is fairly balanced between railways users and the taxpayer.

· Around 98p in every £1 spent from fares goes back into the railway, helping us to deliver the biggest investment in our railway system since the Victorian times. £48 billion will be spent between next year and 2024 meaning quicker and more comfortable journeys, new train carriages and the delivery of projects such as HS2, Crossrail and the Transpennine upgrade (Rail Delivery Group, accessed 14 August 2018, link; Network Rail, accessed 29 November 2017, link).

· As a result of this investment, our trains are safer and are carrying more passengers. Safety of our railway has drastically improved since privatisation and Britain’s railways are among the safest in Europe, based on the number of incidents and accidents. Meanwhile, since 2010, the number of passenger journeys each year has increased by over 447 million. (ORR, Passenger journeys by year, accessed 14 August 2018, link; Back Bench, 5 November 2017, link).

Labour’s renationalisation plans would mean higher borrowing – resulting in higher taxes for ordinary working families and less investment in our railways.

· Renationalisation would mean less investment in our railways and therefore poorer services for passengers. While taxpayers contribute to our railways, this is supplemented by private sector investment. Since privatisation, investment in our railway has substantially increased. In 2016-17, private companies invested £925 million in our rail network, the highest figure recorded since the Office of Rail and Road’s data series began in 2006-07. (Rail Delivery Group, 30 June 2014, link; ORR, Rail finance 2016-17 Annual Statistical Release, 11 October 2017, link; Rail Magazine, 13 October 2017, link).

· Renationalisation would mean nowhere to turn when things go wrong. Families would have no choice if the government ran all train services. Renationalisation would lead to falling standards and rising prices – leaving commuters with no alternative.

Green Party: Grayling shown contempt for rail workers and passengers

The Green Party has responded to news rail fares will increase by 3.2% next year [1], while the Transport Secretary has announced plans for an effective cap on rail workers’ pay [2] by using a different, lower measure of inflation to set wages.

Amelia Womack, deputy leader of the Green Party, said:

“Chris Grayling has left no doubt about where his loyalties lie - with the private companies running our railways, not those who work on or use them.

“The announcements of plans for an effective cap on rail workers’ pay, and yet more fare increases outstripping wages, lay bare Grayling’s contempt for those who depend on Britain’s railways.

“Instead of making passengers and workers foot the bill for his failings, Grayling should be making the train operators enjoying eye watering profits pay their fair share.

“But with fares rising as services descend in chaos it’s ultimately time Britain’s railways were brought back into public hands.”

Peter Vicary-Smith, Chief Executive of Which?, said:

“These price rises are yet more bad news for passengers, many of whom have endured a summer of chaos, including cancellations, delays, overcrowding and poor service from train companies.

“For passengers to genuinely feel they are getting value for money and a rail system that works for them, train companies must improve the reliability and safety of their services, and pay out compensation quickly and hassle-free where it is owed.”

GMB SLAMS ‘COMMUTER TAX’ AS RAIL FARES SET TO RISE 36% SINCE 2010

Union says eye watering rise proves deck is stacked against working people

Rail fares will rise by 3.2% in January, following the ONS’s announcement of the July RPI rate.

The announcement means that the average price of regulated rail fares, such as season tickets, will have risen by 36% since 2010. [1]

The increase in travel prices is significantly above forecast average wage growth of 2.4% next year. [2]

Tim Roache, GMB General Secretary said:

"Millions of passengers face a grim start to the New Year when they are forced to pay even more extortionate prices for a frankly shocking service from the privatised rail companies.

"Rising travel costs, effectively a commuter tax, place an intolerable burden on working people, especially when wage rates don’t keep pace.

"The annual price hike seems to be the only part of the privatised railway that always runs as scheduled. Today’s announcement proves once again that the deck is stacked against ordinary working people."

ENDS

Contact: GMB Press Office on 07958 156846 or at press.office@gmb.org.uk

Notes for editors:

[1] Regulated rail fares, which include almost all season tickets, are raised in January by the 12-month RPI rate of the preceding July.

Before 2014, rail fares were raised by RPI+1%.

Year

Average increase (%)

Index of prices

2010

100

2011

5.8

105.8

2012

112.1

2013

4.2

116.9

2014

3.1

120.5

2015

2.5

123.5

2016

124.7

2017

1.9

127.1

2018

3.6

131.7

2019

3.2

135.9

Sources: House of Commons Library, Railways: fares statistics, 04 June 2018, Table A5 https://researchbriefings.parliament.uk/ResearchBriefing/Summary/SN06384; GMB calculations.

[2] Forecast average earnings taken from OBR, Economic and Fiscal Outlook: March 2018, Table 3:10, printed page 83 http://cdn.obr.uk/EFO-MaRch_2018.pdf