14/08/2012 10:01 BST | Updated 13/10/2012 10:12 BST

UK Inflation Rise Hits Commuters As Rail Fares Set To Increase By 6.2%

Hard-hit rail commuters face a greater-than-expected 6.2% hike in average fares in the new year after official figures revealed a shock rise in the inflation rate.

The retail prices index (RPI) figure for July, which is used to determine how much regulated rail fares including season and saver tickets are allowed to increase in 2013, rose to 3.2% from 2.8% the previous month, according to the Office for National Statistics.

The City had expected the rate to remain flat at 2.8%.


People travelling into London could face travel costs of more than £100 per week

Unions said tens of thousands of rail commuters will have to pay more than £5,000 a year for their season tickets after the new rises come into effect.

The Transport Salaried Staffs Association (TSSA) said people travelling from the counties to London will have to spend more than £100 a week from the new year just to get to work.

Bob Crow, leader of the Rail, Maritime and Transport (RMT) union, said: "People will be rightly angry as they work out what this inflation-busting increase in fares means for them.

"This money will not be invested back in services, it will be trousered by the greedy train operators as another windfall profit.

"Train companies get billions of pounds in subsidies from the government, yet still put fares up.

"Renationalising the railways would save the taxpayer money."

The average fare increase for England is calculated by adding 3% to RPI, meaning a hike of 6.2%, although some tickets can go up by a further five percentage points - or more than 11% - as long as they are balanced by cuts on other fares.

The greater-than-expected rise in RPI, which was accompanied by an increase in the closely watched consumer prices index (CPI) rate to 2.6% from 2.4%, was driven by hefty hikes in air fares, while there were fewer discounts from retailers who had already slashed prices in June to shift stock amid the wash-out weather.

The planned hike in average regulated ticket prices, which follow a similar increase for 2012, will mean that fares have risen by more than inflation for 10 years in a row.

Governments in Wales and Scotland have indicated that regulated fares are likely to go up by one percentage point above RPI.

Unions, transport campaigners and rail passenger groups have been staging a day of action at railway stations across the country to protest against the "massive" hikes.

Stephen Joseph, chief executive of the Campaign for Better Transport, said the increases are "untenable" because fares will rise three times faster than salaries next year, which it claimed will damage the economic recovery.

Friends of the Earth predicted the increases will have a knock-on effect on the country's roads.

The pressure group's Head of Campaigns, Andrew Pendleton, said: "Rocketing rail fares will be an enormous blow to cash-strapped commuters and will simply make it harder for many people to get to work and encourage more vehicles onto our over-crowded roads.

"Earlier this year the government froze fuel duty for motorists - similar support should be given to rail-users by capping fare rises below inflation."

Meanwhile, today's rise in the rate of CPI brings to an end three months of falls, intensifying the squeeze on struggling families.

The ONS said air fares, which are highly seasonal, rose 21.7% between June and July - the largest increase since 2004.

Travel companies have recently reported an increase in demand for foreign holidays as people look to escape the wet start to the British summer, while there have been anecdotal reports of people leaving London to escape the Olympics.

And July saw the record smallest monthly fall in prices in footwear and clothing prices after retailers brought forward their summer sales to June.

A Treasury spokesman said: "Inflation has halved since its peak in September but any increase is disappointing.

"The government knows how tough things are for families at the moment and that is why we have reduced income tax, and frozen both council tax and fuel duty."

Updated 19:00 with Friends of the Earth comments