Rail Fare Reform Could Lower Annual Ticket Increases Across England

The government is considering a significant shift in rail fare calculations that could reduce annual ticket price rises for millions of passengers in England. Sources indicate that Rachel Reeves is preparing to address the issue of surging rail prices in the upcoming Budget by revising how fare caps are set, a move aimed at easing cost of living pressures on households.

Currently, regulated rail fares increase every April based on the previous July’s Retail Prices Index, with an additional one percent often added to the total. For example, with RPI at 4.8 percent in July, fares are due to rise by 5.8 percent in April. This longstanding method has led UK train tickets to rank among the highest in Europe, drawing criticism from passenger groups and campaigners who argue that policy disproportionately affects regular commuters.

The Treasury is now weighing whether to switch to the Consumer Prices Index for calculating fare rises, a measure that generally sits below RPI. In July, CPI was recorded at 3.8 percent, making it notably lower than the equivalent RPI figure. If this change is enacted, passengers could see meaningful savings. An annual ticket from Woking to London, for instance, would increase by £204 to £4,464, which represents a £43 saving compared with the RPI-based rise. Season ticket holders travelling from Canterbury to London would see an increase of £359 to £7,836, saving £75 under the planned reform.

Passenger advocacy groups have consistently campaigned for this adjustment. Bruce Williamson of Railfuture noted that, although long sought after, the proposal should be regarded as overdue. He also emphasised that rail fares remain high, especially in comparison to the freeze on fuel duty that continues to benefit motorists.

The switch to CPI would align with a broader government trend of moving away from RPI in public sector calculations, such as renewable energy subsidies, where consultation on similar reforms has already begun. No final decision has yet been taken and a Department for Transport spokesperson stated that the Budget will not be pre-empted.

Labour’s wider plans include the introduction of Great British Railways, designed to simplify the fare structure. However, there has been no firm commitment to making travel less expensive beyond adjustments to annual increases. The outcome of the Budget announcement will be closely watched by both passenger groups and regular rail users who continue to contend with some of the continent’s highest fares.