Bigger savings if services returned to the public domain

Rail fares for season tickets, and other regulated fares, have risen nearly three times faster than wages over the last five years, according to new analysis that will published tomorrow by the TUC and the rail unions’ Action for Rail campaign.

The analysis shows that between 2010 and 2015 fares increased by 25 per cent in real terms, while average pay went up by just 9 per cent.

The government has announced plans to cap annual increases in regulated rail fares at the Retail Price Index (RPI) measure of inflation for this parliament. However, the public will finance the fare cap through paying their taxes. The capping of rail fares will cost taxpayers around £700 million over the next five years, according to Department for Transport figures.

The TUC says that far bigger savings could be passed onto passengers if services were run by the public sector. Research commissioned by Action for Rail shows that £1.5bn could be saved over the next five years if routes, including the Northern, Transpennine and West Coast Main Line, were returned to the public sector.

The research – carried out by Transport for Quality of Life – estimates that season tickets could be 10 per cent cheaper by 2017 if routes coming up for re-tender were run by the public sector.

A third (£520 million) of this £1.5bn saving would come from recouping the money private train companies pay in dividends to their shareholders. 

The rail unions and the TUC’s Action for Rail campaign are marking tomorrow’s inflation figures with a protest at stations across the country. Campaigners will hand out postcards highlighting the huge cost of rail privatisation. The postcards will call on MPs to put people before profits and return our railways to public ownership.

Rail fares have rocketed over the last five years leaving many commuters seriously out of pocket.

If ministers really want to help hard-pressed commuters they need to return services to the public sector. This is a fair, more sustainable option and it would allow much bigger savings to be passed on to passengers. Introducing an arbitrary cap on fares is simply passing the bill on to taxpayers.

The government wants the public to subsidise train companies’ profits and bear the cost of the fares cap.

Action for Rail brings together the TUC, ASLEF, RMT, TSSA and Unite to work with passenger groups, rail campaigners and environmentalists to campaign against cuts to rail services and staffing and to promote the case for integrated, national rail under public ownership. For more information please visit www.actionforrail.org

Beth Farhat

TUC Northern Region Secretary