MPs attack ‘commuter tax’ rail fares plan at peak times

Ministers should set out a long-term policy on annual season ticket fare rises, the report by the House of Commons Transport Committee says.

Reducing the cost of the railways to taxpayers must not be achieved by “ramping up fares” said committee chairman Louise Ellman.

The committee’s report comes just two days after inflation-busting 4.2 per cent fare rises.

Following Sir Roy McNulty’s report into rail costs, the Government is looking at a variety of measures which include possibly managing peak-time demand by increasing fares for those wanting to travel during rush hour.

But the committee’s report said many lower-paid workers had no choice but to travel at peak times and warned against the move, adding; “Higher prices at peak times might make a difference to demand at the margin but would for the most part be a tax on commuters who have no effective choice over how or when they travel.”

This year’s regulated fare rise would have been even higher had the Government not pulled back from the original plan of an RPI-inflation-plus-three per cent rise in favour of a formula which limited the increase to RPI plus one per cent.

The committee said it welcomed the decision but MPs were “concerned about where that leaves the Government’s fares policy, especially at a time when it is attempting to reduce the cost of rail to the taxpayer”.

The report went on: “We recommend that the DfT (Department for Transport) set out a long-term policy on regulated fares.”

The committee said it was “very concerned” about the safety implications of proposals to reduce staffing at stations and on trains, and it called on rail regulators to ensure high standards of rail safety were “not jeopardised by different ways of working”.

Mrs Ellman (Lab: Liverpool Riverside) said: “There are good economic, social and environmental reasons for the Government to provide a £4bn subsidy to the railway, but to drive efficiency savings across the sector the Government and the regulator must shine a light on complacent management, waste and profiteering by ensuring greater transparency in the finances of the rail industry.

“It is vital we know far more about how public money is spent so that there is confidence it does not leak out of the system in the form of unjustified profits. The Government should publish and consult on a clear statement of what the subsidy is for and where it should be targeted. Commercial confidentiality should not be used to block legitimate requirements for information.”