Train fares will increase by more than 3% again in January 2019

The people who travel in farewell form are prepared for another year of high price rises next January, since the Government continues to link the rates with the inflation measure of the Retail Price Index.

Each year, train fares are linked to the July RPI figure, which will be announced next Wednesday. Currently, it is 3.4 percent with poor prognosis of movement.

It is very likely to stay above three percent, and this time it will be the "limited" amount by which operators can increase regulated prices, including annual season tickets.

Frustration: It has been another year in which thousands of travelers have suffered with poor service, and prices are ready to increase once again by more than 3%

Frustration: It has been another year in which thousands of travelers have suffered with poor service, and prices are ready to increase once again by more than 3%

Frustration: It has been another year in which thousands of travelers have suffered with poor service, and prices are ready to increase once again by more than 3%

However, the Office of National Statistics has used the Consumer Price Index as its preferred official measure since 2003 – RPI has not had "national statistics" status since 2013.

The CPI is also the measure on which the Bank of England focuses on the interest rate policy.

This is Money has tried to establish why the train fare increases are linked to RPI, but the Department of Transportation has never given us an accurate answer.

In January, rail fares rose 3.4 percent. This was the largest increase for five years and was slightly below 3.6% of the RPI figure for July 2017.

Prices are likely to increase by a similar amount in January 2019. Again, hundreds of pounds will be added to the cost of some annual tickets.

Our calculations show that prices would be approximately eight percent lower if the CPI figure instead of the IPR figure had been used since 2011.

On an annual season ticket of £ 5,000, this is £ 400 and £ 3,000 at £ 240.

THE RENTAL OF THE TRAIN RATE

Each January, the rates increase by the RPI figure of the previous January.

Here is how they have increased since 2011 compared to the July CPI

2011: RPI 4.8% vs CPI 3.1%

2012: 5% vs. 4.4%

2013: 3.2% vs 2.6%

2014: 3.1% vs 2.8%

2015: 2.5% vs 1.6%

2016: 1% vs. 0.1%

2017: 1.9% vs 0.6%

2018: 3.6% vs 2.6%

2019: 3.4%? vs 2.3%

Difference between the two each July since 2011: 8.4%

An increase of 3.4% would raise the cost to £ 5,170 and £ 3,102 per year, respectively.

The Office of National Statistics, which produces both figures, is deeply critical of the RPI data.

Jonathan Athow, an assistant national statistician for economic statistics at the office, said last year: "The RPI is not a good measure of inflation and we discourage its use.

"But we do not have the authority to stop using the RPI or to tell particular users what index they should use in any given circumstance."

Steve Chambers, in the Campaign for Better Transportation, said: "The government should stop using the RPI.

"The ONS stopped using it as a measure of inflation in 2013 because it constantly overestimates it, now is the time to apply the CPI to increases in rail fares.

"Using the CPI to establish railway rate increases would have little impact on rail revenues, but it would save passengers money and adjust rates to things like pensions."

The student loan increases are also linked to the RPI, along with a series of taxes, including taxes on tobacco and alcohol.

On an annual train ticket to Birmingham to London Euston, a 3.4 percent increase would add about £ 350 on the price, making it about £ 11,000.

From Norwich to London Liverpool Street, with a 1-6 area travel card, the price would increase by £ 310 to more than £ 9,500.

An annual from Liverpool to Manchester would rise from £ 107 to £ 3,229.

Meanwhile, those who have an annual ticket to Maidenhead, the constituency of Prime Minister Theresa May, would see prices rise from £ 105 to almost £ 3,200.

CPI VS RPI

The CPI and the RPI are a measure of how prices have gone up. The favorite of the government is CPI.

The CPI excludes most housing costs, such as municipal taxes and mortgage interest payments.

According to the ONS: The basic approach for measuring inflation adopted by both the CPI and the IPR is the same.

"Both track the changing costs of a fixed basket of goods and services over time and both are produced by combining around 180k individual prices for more than 650 representative items."

Because they track different elements and the formula is different, the CPI is generally lower than the RPI.

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