Price rise for Newcastle-London train tickets

Nov 22 2008 by William Green, The Journal

A BASIC rail return to London will smash through the £100 barrier in the New Year. Passengers turning up to Newcastle station to buy an off-peak ticket will have to fork out £105 to go to the capital and back.

Business leaders and passenger groups joined forces to criticise price rises in the North East of up to 11% with a recession looming.

The huge rises went against pleas from Transport Secretary Geoff Hoon to consider the economic situation when setting fares.

North East politicians last night called for the price hikes to be re-examined, amid fears they could leave people and companies even worse off in the economic downturn.

But rail companies said the rises were needed to help pay for improvements to services.

CrossCountry, which runs trains from Newcastle to Leeds, Sheffield, Birmingham and Bristol, put advance and leisure fares up 11%. Regulated tickets – including season passes – are jumping by 6%.

Its owner Arriva reported a 5% rise in full year pretax profit in March – up to £115.8m.

National Express, which operates the crucial East Coast Main Line to London, put regulated fares up 6% and unregulated tickets by 7.4%. In February, the company announced a 44% rise in pre-tax profits to £149m.

It also guaranteed shareholders an extra 10% on dividends for the next three years, partly because of the strength of the East Coast business.

Regulated ticket rises are linked to inflation, but the new prices, which will start on January 2, are based on the July figure of 5%. Most experts expect inflation to fall rapidly next year.

Tyne Bridge MP David Clelland, who sits on the Commons transport committee, said: “Given the current economic situation and the fluctuation of inflation since these figures were drawn on, I would hope there could be a re-examination of the proposed increases.”

Ross Smith, head of policy at the North East Chamber of Commerce, called for “flexibility” on the price rises and complained many businesses were unable to take advantage of cheaper advance bookings. A spokesman for National Express East Coast said it was investing in services, including a £45m upgrade of its diesel train, and station improvements.

The company said it was working hard to attract more passengers with advance purchase discount fares, with many tickets still comparing favourably with motoring or flying.

A CrossCountry spokeswoman said the changes were necessary to allow it to continue investing in a “better travel experience” for customers. She said the franchise was granted on the basis of cutting a taxpayer subsidy from £238m a year to £5m by 2016 to establish an almost entirely commercial network. Transport union TSSA said train companies had “a licence to print money”, while watchdog Passenger Focus said the “unstoppable rail-price express ploughs on”.

Gordon Brown’s spokesman said: “Secretary of State Geoff Hoon this week reminded operators that difficult economic circumstances will make these concerns more acute and called on them to bear this in mind when setting fares. It is a matter for the rail companies to explain why they have made the decisions.”