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Calls mount to scrap annual rail fare rise in England

Ministers are facing mounting calls to scrap the annual inflation-linked hike that affects about half of UK rail fares to help alleviate the cost of living crisis and encourage more people to return to the UK. to take public transport.

Price increases for regulated fares, which typically occur on commuter routes and include subscriptions, are calculated using the July Retail Price Index as a benchmark. This figure is expected to be close to June’s figure of 11.8 percent when released on Wednesday, the highest level since the early 1980s.

The transport ministry has promised to take “decisive measures” to protect passengers and has said it will not raise fares by as much as July’s RPI figure. It has also said it will delay the price hike from January to March next year.

But passenger groups have called on the British government, which is responsible for setting fares in England, to go further. The Campaign for Better Transport said there was evidence that fare hikes were reducing passenger numbers and that a freeze could be financed by introducing a new tax on jet fuel for domestic flights.

“The money raised could help pay a freeze on rail fares next year to make the trains cheaper and encourage more people to use them,” said Paul Tuohy, CEO of Campaign for Better Transport.

Chris Page, chairman of the Railfuture passenger group, said the government should make train travel “much more affordable” to address the cost of living crisis.

“The government claims the rate hike will be lower than inflation, but the devil is in the details. They won’t say what the increase will be, or what rates it will apply to,” he said.

Transport Secretary Grant Shapps and Chancellor Nadhim Zahawi have pledged to follow the convention and not make any major policy announcements until the ruling Conservative party elects a new British Prime Minister on September 5.

A government insider said no decisions on rail fares would be made this month: “The usual set of options is being worked out for the next government.”

Regulated train fares apply to about 45 percent of tickets, including season tickets and many off-peak fares on long-haul routes. Rates in Wales typically follow the increase in England, while the decentralized administration in Scotland follows a similar formula, mirroring the increase in the rest of the UK in 2022.

The annual regulated rate increases, which were implemented in January, were traditionally calculated using the RPI plus one formula based on the previous July inflation data. But ministers intervened to set the increase for this year, kept it at RPI, which stood at 3.8 percent in July 2021, and postponed the increase until March.

Passenger groups have long pushed for reform of the system to prevent commuters and other travelers from experiencing real fare increases, especially as the RPI inflation measure overestimates the annual rate of price increases by nearly 1 percentage point.

But ministers will face a tough balancing act when they finally decide on fare changes for 2023. Any decision that substantially shields passengers from inflation would put further strain on rail industry finances.

The sector faces a funding shortfall of £2bn a year as ticket revenues fell during the coronavirus pandemic and faces national strike action this summer as unions protest attempts to balance the books by cutting staff costs. Members of the RMT will organize further strikes on Thursday and Saturday that are expected to bring large parts of the network to a standstill.

The disruption to train services comes as ministers were warned this week by regional leaders about “significant” cuts to bus schedules as government support for the coronavirus ends.

Northern England mayors have called for funding to be maintained as the industry shifts to changing travel patterns after the pandemic.

The emergency funding was supposed to run out in April, but was extended until October. However, bus operators must notify schedule changes in advance, allowing a decision on cuts to be made in the coming days. The DfT has said it is committed to investing £3bn in bus services by 2025, but routes must be commercially viable and reflect passenger needs.

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