by Jordan Hall
The unexpected jump in the RPI rate of inflation will be grim news for rail passengers. UK commuters who already pay the highest fares in Europe, face further increases of at least 6% from next January.
The coalition has insisted that above inflation fare rises will end when the costs of the rail industry are brought down. However this argument doesn’t stand up when Network Rail has already slashed running costs over a 5 year period.
Rail reform could be the key to winning over swing voters in the marginal commuter constituencies that Labour will need to win to form a majority in 2015.
Back in June shadow transport secretary, Maria Eagle, welcomed the Rebuilding Rail report by Transport for Quality of Life as a consideration in the policy review.
The report presented the case for reintegrating the operations and infrastructure arms, phasing out franchising and giving passengers, the workforce and elected local and regional authorities a greater say in the industry.
The current system guarantees private rail operators taxpayer funds if their profits fall below a fixed level. It is estimated that £1.2bn of public money has been lost each year as a direct result of the fragmented system. This money could have reduced current fares by as much as 18%.
Taxpayers already subsidise the rail industry to the tune of £4bn a year – an industry characterised by mini-monopolies charging UK passengers high fares and siphoning off the profits to continental parent companies.
Scrapping the current model and adopting a system along the lines of the Rebuilding Rail report would secure value for money for the taxpayer and put an end to above inflation fare rises. Such a policy would be a welcome reprieve for squeezed commuters hit by higher and higher rail fares.
Ed has consistently put fairness at the heart of his leadership. On energy markets and challenging the rip-off culture, he has set the agenda whilst coalition policies such as the VAT rise compound the pressures on working families. A programme of rail reform that delivered savings for the taxpayer and lower fares for squeezed commuters could be a vote winner.
Jordan Hall is a Labour activist