Higher peak-time rail fares opposed

The government should rule out using peak-time train fare rises to manage passenger numbers, MPs have said.

A Commons Transport committee report said this "would for the most part be a tax on commuters who have no effective choice over how or when they travel".

Many lower-paid workers could not avoid travelling at peak times, it said.

The government said it was "looking at how fares might be used to spread demand more evenly". Increases in fares of about 4% have come in this week.

The MPs' report sets out their vision for the rail network by 2020.

Committee chair, Labour MP Louise Ellman, said: "The government wants to reduce the cost of the railway to taxpayers, but it must not do so by ramping up fares which can be complex and are often very expensive.

"Ministers must urgently set out a long-term policy on fares and rule out using higher fares to reduce peak demand for train services."

Prices are already cheaper outside of the 07:00 to 10:00 and 16:00 to 19:00 peak periods, but the idea is that pricing variations could be introduced even within those periods to "smooth" commuter demand.

"Higher prices at peak times might make a difference to demand at the margin but would for the most part be a tax on commuters who have no effective choice over how or when they travel," the MPs said.

The government is carrying out a fares and ticketing review, which is due to conclude in May, as part of a drive to find billions of pounds in efficiency savings and reduce taxpayer-funded subsidies to the railways.

A 2011 government-commissioned report on value-for-money in the railways, by Sir Roy McNulty, offered recommendations that he said could save between £700m and £1bn annually by 2019.

'Balanced and fair'

But the MPs argued that rail industry finances had to be more transparent, to ensure it was clear where taxpayers' money went.

"There are good economic, social and environmental reasons for the government to provide a £4bn subsidy to the railway, but to drive efficiency savings across the sector the government and the regulator must shine a light on complacent management, waste and profiteering by ensuring greater transparency in the finances of the rail industry," Ms Ellman said.

"It is vital we know far more about how public money is spent so that there is confidence it does not leak out of the system in the form of unjustified profits."

Transport minister Simon Burns said that the fares and ticketing review was "not about squeezing more revenue out of regulated fares and that any changes stemming from it would need to be balanced and fair".

"We are looking at how fares might be used to spread demand more evenly, including rewarding passengers who are able to avoid the busiest services," he said.

The government had embarked on "one of the biggest investment programmes in our railways since the Victorian era", he said, during which it was "also vital that the industry looks to how it can provide better value for money for both taxpayers and farepayers while delivering the safe, competitive railway that passengers expect".

Michael Roberts, chief executive of the Association of Train Operating Companies, said: "We flatly reject the unfounded accusation that train companies are profiteering, an allegation which appears to be based on hearsay and flies in the face of the report's own explicit statement that profits are 'relatively small'."

Manuel Cortes, leader of the TSSA transport workers' union, said the select committee report was "the clearest warning to ministers against going down the route of rationing rail travel by pricing passengers off trains through super peak-fare tickets".

But RMT union general secretary Bob Crow said the report "ducks the real issue and that's the cast-iron case for public ownership"

"You can't have transparency, accountability and value for money while our railways are bust apart and run as a money-making racket for a gang of private operators," he said.