Rail passengers are to be hit again by big fare rises in the new year with some tickets going up by more than double the rate of inflation despite the economic downturn.

Regulated fares, which include season tickets, are rising by an average of six per cent from January 2. Unregulated fares, which include most leisure and advanced-fare tickets, will be rising by an average of seven per cent, with some fares going up by an average of more than 11 per cent.

Regulated fares are based on a set formula which limits increases to one per cent above retail price index (RPI) inflation. The bad news for commuters is that the fares for a new calendar year are always set at whatever the RPI figure was the previous July. This year’s July RPI was 5.0 per cent - a figure which has now dropped, too late for commuters, to 4.2 per cent and is expected to fall sharply in the coming months.

Announcing today’s rises, the Association of Train Operating Companies (Atoc) said the increased revenue would help pay for major investment to improve the railways and deliver better value for taxpayers in line with Government policy to reduce subsidy to the railway by 40 per cent between 2006/07 and 2013/14.

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Don't blame the train companies - the real culprit in this annual price-gouging exercise is the Government

Ben Webster, Transport Correspondent

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Passenger groups reacted with outrage to the hikes, however, claiming they were "unjustified and unfair" and describing them as "daylight robbery".

Atoc said that train operators were currently carrying out work worth more than £800 million to introduce new trains, refurbish existing fleets and improve stations. It added that these measures would benefit passengers through more reliable and comfortable journeys, improved station facilities including more car and cycle parking and better personal security.

Fare revenues and Government grants would also help fund the multi-billion pound investment programme to increase network capacity, which starts in 2009.

Michael Roberts, Atoc chief executive, said: “Passengers in recent years have helped pay for 20 per cent more services, and performance in the first half of this year is at the highest level since records began, with more than 90 per cent of trains arriving on time.

“Yet, since 1996, in real terms, overall rail fares have risen by just five per cent and standard-class regulated fares are actually lower than they were in the year before privatisation.”

He went on: “Record performance and better services have contributed to the highest number of passengers travelling by rail for 60 years. The January fare changes mean that train companies can continue investing in an even better railway and still offer a range of good deals for customers.

“More than 80 per cent of rail journeys are made using either a price-regulated or discounted ticket. And with the real costs of motoring up by over 25 per cent since 1996, rail will continue to be an attractive option for millions of people every day.”

However Passenger Focus, an independent consumer watchdog, said it was wrong to impose such hikes when commuters were facing tough times in the economic downturn.

Chief Executive Anthony Smith questioned why passengers should see their fares increase when inflation had fallen significantly and was expected to fall further next year.

“These fare rises hark back to a time of high inflation and spiralling energy costs,” he said.

“The economy is different now, but the seemingly unstoppable rail price express ploughs on. Fare rises way above inflation are unjustified and unfair.”

He said the government needed to look again at linking fares to inflation and said rail company’s investment and performance should also be taken into account. “We cannot simply go on dumping costs onto the passenger in this way,” Mr Smith said.

Gerry Doherty, leader of transport union TSSA, said the rises made a "mockery" of the Government's pledge to help hard-working families through the recession.

“Ministers should have cancelled this annual inflation-plus increase if they were serious in helping people just get to work, let alone keep their jobs," he said.

“As it is they have allowed the rail companies to increase fares regardless of the standard of service they provide. This is a licence to print money and it should be stopped.

“If every other business is cutting prices, why should the rail companies be allowed to get away with daylight robbery?”

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