U.K. Caps Rail-Fare Increases in Drive to Cut Cost of Living

The U.K. government capped the amount rail companies can increase fares in a move it said may save some commuters as much as 200 pounds ($320) a year.

Train operators will only be permitted to increase fares by 6.1 percent in January 2014, down from the 9.1 percent that would have been permitted under current rules, Transport Secretary Patrick McLoughlin said in an e-mailed statement.

Companies are allowed to increase prices annually by inflation plus 1 percent and had been able to add an additional 5 percent to some tickets as long as the average rise on a range of regulated fares was limited to 1 percent above inflation. That extra charge will now be limited to 2 percent.

“By capping fares we are protecting passengers from large rises at a time when family incomes are already being squeezed,” McLoughlin said today. “We will need to wait for the rail industry to calculate individual ticket prices for next year, but this cap could save some commuters as much as 200 pounds a year.”

Retail-price inflation in July 2013, on which the fare increase is calculated, was 3.1 percent.

The announcement is part of a fares and ticketing review published by the Department for Transport today, which also encourages the development of paperless tickets, a code of conduct so passengers are confident they are getting the best deal for their journey, and the introduction of season tickets for part-time workers.

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