Hard-hit rail commuters face a greater-than-expected 6.2 per cent 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 per cent from 2.8 per cent the previous month, according to the Office for National Statistics.
The City had expected the rate to remain flat at 2.8 per cent.
The average fare increase for England is calculated by adding 3 per cent to RPI, meaning a hike of 6.2 per cent, although some tickets can go up by a further five percentage points – or more than 11 per cent – 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 per cent from 2.4 per cent, 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 figures come as the unions and passengers launch a day of protests over rail fares.
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.
@channel4news Try £6360 a year..andSouth Eastern won’t let us pay for season tickets by monthly DD like other rail operators do
— Ben Tanner (@ElTanner) August 14, 2012
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 staged a day of action at railway stations across the country today 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.
And 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.
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 per cent 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.”
@channel4news But, as I have to have travel card as well.. cost is £4516 pa. This will increase to £4728 from January 2013.
— Raymond Lee (@rayleee) August 14, 2012