Britain's worst-performing train company has announced it will double the amount of compensation it is giving to passengers affected by delays and disruption.

The company, which carries 60,000 people a day on routes linking London, Berkshire, Oxfordshire, Wiltshire, Gloucestershire, the West Country and South Wales, admitted it had not given customers the service they deserved over the past year.

The compensation move will benefit tens of thousands of rail travellers, while the company also announced that fares and car parking charges will be frozen at their current prices at least until the end of the year.

FGW said in a statement: “This move recognises customers have not received the service they deserve, and means that most regular passengers will effectively pay the previous year’s prices for their 2008 season tickets on renewal.

“Season ticket holders will receive their compensation when they renew their current tickets.”

Under the terms of the Passenger’s Charter, if reliability and punctuality targets are not met, season ticket holders receive a refund of 5% or 10%. First Great Western will now refund 10% or 20% of the season ticket value.

A customer with a standard class annual season ticket between Bristol and Paddington will now be entitled to £867 in compensation.

Weekly season and day ticket holders will also be able to claim double compensation if their service is significantly delayed or cancelled.

Andrew Haines, FGW chief operating officer, said: “We’ve not given customers the service they deserve over the last 12 months, and we’re sorry.

“We want to do the right thing by our customers. We are working with Network Rail to help us deliver a better service, but I recognise the promise of a better service tomorrow is little consolation for poor performance. I want this to send a clear message that we take our performance commitments seriously.

“This move will benefit tens of thousands of customers, and along with it goes our commitment to do everything possible to make sure service improves this year.”

Anthony Smith, Passenger Focus chief executive, said: “This deal is an important step towards rebuilding a link between service quality and price. It follows weeks of discussion and shows First Great Western is listening to passengers and passenger groups.”

London TravelWatch chairman Brian Cooke welcomed the announcement, saying: “This move recognises that customers need to be listened to, and we are pleased that process has now started.”

FGW passengers are planning a fares “strike” next Monday in protest at rising prices.

The company narrowly escaped a 48-hour strike by guards. Around 500 staff were planning to walk out in a row over industrial relations.

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive