Tabled by Baroness Randerson To ask Her
Majesty’s Government whether they intend to review the mechanism
used to determine annual increases in train fares. Lord Bradshaw
(LD) My Lords, with the leave of the House and on behalf of
my noble friend Lady Randerson, I beg leave to ask the...Request free trial
Tabled by
-
To ask Her Majesty’s Government whether they intend to
review the mechanism used to determine annual increases in
train fares.
-
(LD)
My Lords, with the leave of the House and on behalf of my
noble friend Lady Randerson, I beg leave to ask the
Question standing in her name on the Order Paper.
-
The Parliamentary Under-Secretary of State, Department for
Transport (Lord Ahmad of Wimbledon) (Con)
My Lords, the annual increase of regulated rail fares is
set using the retail prices index figure published for
July. This is consistent with the approach adopted across
the rail industry. The UK Statistics Authority concluded in
2015 a consultation and review of UK consumer prices
statistics. The review recommended moving towards ending
the use of the RPI. The Government will await the UK
Statistics Authority response before considering further
changes to the current mechanisms.
-
My Lords, I thank the Minister. In waiting for that
response, will the Government consider whether it is right
to have a universal increase in fares across all services,
regardless of the quality of service for passengers? In
particular, it seems to me that London commuters,
especially those from south of the river, are facing a
situation where the Government are using RPI automatically
to increase fares on Southern, regardless of the quality of
service being offered.
-
As I have already said, we will certainly look at the
findings and will then make an appropriate decision. The
noble Lord raises the important point about fare increases,
which I know impacts many in your Lordships’ House and many
beyond. However, as he will be aware, regulated fare
increases are capped at RPI plus 0% for the term of
Parliament until 2020.
-
(Con)
My Lords, would it not be rather curious if we adopted the
suggestion from the other side of the House? It would mean
that we would be raising fares where the demand was lowest,
and raising the fares most where the demand was lowest.
-
Noble Lords
Highest.
-
I think that I follow the thread of my noble friend’s
remarks. I agree with him about the importance of giving
certainty to those who are affected. We are adhering to the
position that the Government have taken, which was a
manifesto pledge.
-
(Lab)
My Lords, does the Minister agree that, as recently as
2008, 50% of train fares in the United Kingdom were met
from the Treasury, and the same proportion was paid for by
the train traveller? As that percentage has now been skewed
to 27% by the Treasury and the remainder by the traveller,
does that not have some impact on the mechanism for fare
increases on an annual basis?
-
Again, the noble Lord raises an important point. If we were
to put figures to that, there is about £4.8 billion in
government subsidy. He is quite right that the rest comes
from rail revenue, which is about £9.8 billion. It is
important that there has been a review of the current
process; we should await the outcome of that consultation
and the Government will then take any necessary decision at
that time.
-
(LD)
My Lords, is the Minister aware that passengers are now
using consumer laws to gain refunds from their credit and
debit card providers? This is a very worrying practice.
Will the Minister issue a clear instruction to Southern
that this is its obligation? It should be met and the
situation ought to be monitored.
-
The noble Lord is right to raise the important issue of
compensation for Southern passengers. The Government are
acutely aware of the challenges on that network, as many
from across your Lordships’ House have also made clear to
me during our debates on this issue. As the noble Lord will
be aware we have issued additional compensation schemes but
we continue to work with and monitor Southern, and to hold
it to account for any issues which arise. If the noble Lord
has specific matters or a particular case to raise, I ask
him to please write to me.
-
(Lab)
Why do the Government keep claiming that the regulated fare
increases are needed to fund the investment programme in
the railways, when the increase in fares paid by rail
passengers is really intended to achieve a continuing
reduction in government subsidy, and a continuing increase
in the percentage of rail costs that are paid for by
hard-pressed fare-paying passengers to well beyond that in
nearly every other country?
-
Again, what the Government have done was made clear in the
run-up to and during campaigning in the last general
election: that what rail users need when it comes to fares
policy is certainty. That is why we gave a commitment to have
RPI plus 0%, and we are staying true to that pledge.
-
(Lab)
Has the Minister noticed that the Scottish Government are
doing exactly the same as the United Kingdom Government on
rail fare increases, proving yet again beyond peradventure
that they are still Tartan Tories?
-
The noble Lord always brings a particular viewpoint to our
debates here and he has done so again. It is a matter for the
Scottish National Party to determine its ideology. However,
if it is being won over by the positive agenda of the
Conservative Government then I would welcome that.
-
(Con)
My Lords, does the Minister agree that it is essential to
have an RPI formula in order that the train operating
companies do not have to try to forecast where inflation
might be in several years’ time?
-
My noble friend is right to raise this issue. The basis we
currently use, as I have been clear, is RPI. It is important
to provide certainty to the market not just for people using
the services but, as he points out, for rail companies as
well. As I have said, once we see the result of the
consultation we will look at this.
-
(Con)
My Lords, can my noble friend explain why we are using the
RPI rather than the CPI, as RPI is no longer an official
statistic? Pensioner incomes are tied to the consumer prices
index rather than the retail price index, yet hard-pressed
consumers are having to pay an RPI increase.
-
My noble friend speaks from great expertise, particularly on
pensions, and she is right to raise the concern expressed by
the travelling public. But I say to her that RPI is
consistent with the general indexation approach currently
used across all aspects of the rail industry, including
franchise payments, network grants and franchise financial
models. As she will be aware, those are all indexed at RPI. I
have already alluded to the study; let us await the outcome
and we will then see how we progress on the way forward.
-
(Lab)
My Lords, 378 years ago yesterday, Charles I was executed.
Does the Minister agree that this shows the dangers of any
form of taxation, including indiscriminately taxing rail fare
users for something that should be provided in another way?
-
The noble Lord again raises an important chapter in history.
No matter what challenges the Government face, I hope that
that fate does not await anyone.
|
