Threat of huge rise in rail fares

Hundreds of thousands of mainline rail passengers are today facing the threat of a huge increase in fares when government restrictions on the increases come to an end.

The prospect is infuriating passenger watchdogs, which are warning that many companies want to put up fares saying they need the extra money to fund investment in things such as new trains.

Commuters already have to pay among the highest fares in Europe.

Wendy Toms, chairman of the Rail Passengers Committee for Southern England, which represents the majority of mainline commuters, said passengers will be "outraged" if they have to pay higher fares without a muchimproved service.

She said only one in five peak-hour commuters believe they get value for money and that they must be protected from "exploitation" by the rail companies.

The train operators are also desperate to increase fares to make up for the slump in profits caused by passengers drifting away from the railways because of poor service. Disasters such as Hatfield also led to months of travel chaos and sparked huge compensation payments.

The seven-year restriction limiting commuter fares to around inflation levels is due to end in 2003. It was imposed by the former Tory government as a means of selling rail privatisation to a sceptical public. In theory, the rail companies could then raise the fares to whatever they want.

Connex, which runs the busiest commuter routes in the UK, says it wants to "open the debate" about increasing fares. "We have to get investment into the industry somehow," said a spokeswoman.

The question, she said, is whether the income should come from the taxpayer or the passenger.

Connex has already warned staff of a serious slump in profits - even the drinking water dispensers at company HQ have been axed to save money.

Train services have been so poor that it forced a five per cent reduction in season ticket prices. The company is also facing a ? 200million bill for new trains which still don't work properly and are not yet in service.

The spokeswoman admitted that service would have to improve before fares are put up.

But, she warned, fares could not continue to go down without it having an impact on future investment designed to improve the railways.

Mrs Toms said: "Some train companies would like to see the formula modified, to allow fares to go up." She says in the committee's annual report: "This, they argue, would generate the income needed to pay for substantial improvements to rail services.

"We have always argued that it is unacceptable for today's passengers to be asked to pay higher fares to finance major improvements that some of them may not live to see.

"Once the improvements have been made, it may be another story. But even then, any fare rises need to be phased in gradually, so that passengers are not priced off the railways."

She said the move to restrict cheaper off-peak tickets in London and the South-East - revealed by the Evening Standard last month - is "yet another example of train companies shooting themselves in the foot".

From June, holders of the £20 annual Network Railcard, which allows a 30per cent discount on offpeak fares, will have to pay a minimum of £10 before the reduction applies.

Train operators wanting to increase fares now face a fierce battle with Richard Bowker, chairman of the Strategic Rail Authority.

He told the watchdog London Transport Users Committee that he does not believe fares will have to rise to pay for much-needed improvements.