London commuters are facing an increase in rail fares of up to 4.2% next March after the Budget allocated no funding to extend the current freeze beyond spring 2027.
Transport Secretary Heidi Alexander froze many ticket prices this year, saving some commuters £300 a year. However, detailed figures for the Budget showed that Chancellor John Healey has not allocated any funding for the freeze to continue beyond spring 2027.
How the fare rise is calculated
Regulated train fares in England, which include commuter and season tickets, have traditionally been linked to July's RPI (Retail Price Index) inflation rate, or possibly slightly higher. The system has meant that rail fares have risen almost every year for passengers often suffering delays, disruption and overcrowding.
The Department for Transport used RPI +1% to calculate savings made for rail passengers due to the freeze. If the same formula is used, it would see regulated fares increase by 4.2%, July's RPI of 3.2% +1%.
Impact on season tickets
Such a rise would increase the annual season ticket from Basingstoke into London by £246, from Brighton £259, Canterbury £298, Chelmsford £219, Guildford £202, High Wycombe £197, Reading £246, Southampton Central £314, St Albans £205 and Tunbridge Wells £256, according to figures from Campaign for Better Transport.
Michael Solomon Williams, from the transport group, said: "For drivers, the Government chose to freeze fuel duty for the sixteenth year running. By contrast, rail passengers could see their fares rise again after a one-year freeze. This would be a real blow to people struggling with the cost of living, and send the wrong signal about transport choices in a climate emergency."
Shadow transport minister Alison Griffiths stressed: "Labour promised that nationalisation would bring fares down, but passengers are facing yet another stealth rise in fares. With no money set aside to extend the fare freeze beyond March 2027, commuters are once again being left to pick up the bill for this Government's failure to take tough decisions."
Liberal Democrat London spokesman Luke Taylor, MP for Sutton and Cheam, added: "Londoners are already feeling the impact of the cost of living crisis - so rail fares going up will just spell more difficult decisions across the city."
Government response and nationalisation
The Department for Transport said no decision had yet been taken on fares for next year. A DfT spokesperson added: "We are assessing all options carefully to give taxpayers the best value for money while investing in the railway to deliver better, more reliable services for passengers."
The Government, given its focus on the cost of living, may opt for a lower fare increase, possibly in line with inflation. Whitehall sources pointed out that this year's freeze would have an ongoing impact on ticket prices.
In the Commons on Thursday, Ms Alexander clashed with Opposition MPs over rail renationalisation. Six rail companies have become state-owned since Labour came to power in July 2024, with Chiltern Railways, which operates between London Marylebone and Birmingham, the latest in September. Great Western Railway, which runs services from the capital to the west of England, will be next in December.
South Western Railway came in for particular criticism. Twickenham MP Munira Wilson slammed the unreliability of services run by the rail operator, the first to be nationalised in 2025.
Ms Alexander admitted: "We do need to make more progress on improving punctuality and reliability, and I can't pretend that I'm happy with performance across the entirety of the rail network." But she stressed that during the last reporting period cancellations across publicly-owned operators were 3.9% compared to 4.9% for rail services still in private ownership.
"On punctuality, 82.6% of stops by publicly-owned operators were within three minutes of their scheduled arrival time, compared with just 73.8% for operators yet to transfer," she added.
SWR has launched Improving Your Railway, acknowledging recent challenges and setting out plans to deliver more reliable services.
