16 August 2016
With rail fares set to rise by 1.9 per cent next year, Campaign for Better Transport has reiterated its call for the Government to stop using the Retail Price Index (RPI) figure to set fares and instead switch to the Consumer Price Index (CPI) figure, which is already used for pensions and most benefits.
Stephen Joseph, Chief Executive of Campaign for Better Transport, said: "Today's rise in rail fares proves that the Government needs to stop using RPI to calculate ticket prices once and for all. The Office for National Statistics stopped using it in 2013 because it consistently over-estimates inflation and now it's time to apply the same rule to rail fares. Using the consumer price index to set rail fare increases would have little impact on railway revenues, but it would save passengers money and bring fares into line with things like public sector pensions."
Campaign for Better Transport has previously questioned the use of RPI as the basis of the Government's fares formula. Independent research published by the charity in 2014 found that replacing RPI with the much more widely used CPI would help tackle soaring ticket prices and have only a minimal impacts on revenues.
Stephen added: “We’re also disappointed to see that the Government has missed the opportunity to freeze fares for Southern Rail passengers. Passengers on this line have been subjected to appalling levels of service with no end in sight to their misery and now they will have to pay more for their tickets come January. This is a real slap in the face to long-suffering commuters.”
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Notes to Editors
- Below are examples of how much commuters could have saved since 2014, when the Office of National Statistics dropped RPI as an official measure, if CPI were used to calculate rail increases.
|Station commuted from into London terminals||Savings 2014-2017 if CPI were used to calculate increase instead of RPI|
|St Albans City||£177.87|
For a full breakdown of this data please see here.
- The percentage rail fare increase for 2017 will be 1.9 per cent, July’s RPI figure.
- Retail Price Index (RPI) and Consumer Price Index (CPI) are measures of inflation. Since April 2011, tax credits, most benefits, public sector pensions and tax bands have risen in line with CPI rather than RPI. RPI usually shows a higher rate of inflation than CPI. Between 1996 and 2011, the cumulative inflation rate shown by RPI was 53.6 per cent while that for CPI was 35.6 per cent. In March 2013, the UK Statistics Authority announced that RPI would no longer be designated as a national statistic because it failed to meet international standards. In November 2013, the UK Statistics Authority confirmed the designation of Retail Price Index Jevons (RPIJ) as a new National Statistic ostensibly to replace RPI, although Government has yet to make any statement concerning when or how it may use the new statistic.
- July’s CPI figure was 0.6 per cent.
- The Office for National Statistics stopped using RPI as an official statistic in 2013 because it is so inaccurate.
- In 2014, Campaign for Better Transport published Fares and Rail Financing, written by independent consultants Credo.
- Campaign for Better Transport has previously called on the Government and Govia Thameslink, which runs the Southern Rail franchise, to agree to freeze season ticket prices at 2016 levels as a goodwill gesture to long-suffering commuters.
- Campaign for Better Transport is the UK's leading authority on sustainable transport. We champion transport solutions that improve people's lives and reduce environmental damage. Our campaigns push innovative, practical policies at local and national levels. Campaign for Better Transport Charitable Trust is a registered charity (1101929).