13 September 2011 Last updated at 17:42 ET

Trains are a rich man's toy, says transport secretary

 

Philip Hammond says trains have become a "rich man's toy"

British railways are a "rich man's toy", Transport Secretary Philip Hammond has told MPs.

He was responding to a question about regulating fare prices on the planned high speed rail link so that it would be a "railway for everybody".

He said it was an "uncomfortable fact" that trains were already used by the better-off and said some fares were "eye-wateringly expensive".

Labour blamed Mr Hammond for allowing rail fares to "rocket".

Commuter season tickets are set to rise by about 8% on average next year - an above-inflation increase which is part of the government's plan to reduce the cost of the rail network to the public purse.

'Ripple effect'

Mr Hammond appeared before the Commons transport committee on Tuesday to answer questions on High Speed 2 (HS2) - the planned line between London and Birmingham with a possible future extension to northern England and Scotland.

He was asked by Labour MP Julie Hilling whether HS2 would become a "rich person's toy" unavailable to "people of low or moderate means".

She said: "Can you assure people that actually, it's going to be a railway for everybody, and what will happen about regulating fare prices, etc?"

Mr Hammond replied: "Uncomfortable fact number one is that the railway is already relatively a rich man's toy - the whole railway.

"People who use the railway on average have significantly higher incomes than the population as a whole - simple fact."

He said it was assumed HS2 would use "similar pricing to the West Coast Mainline, which I have said before ranges from eye-wateringly expensive to really quite reasonable, if you dig around and use the advance purchase ticket options that are available".

The assumption was that the "socio-economic mix" of HS2 passengers would be similar to those using that route and that the "ripple effects" of High Speed 2 would spread across the economy.

The transport secretary later told the BBC he had not been talking about the cost of rail tickets but had answered a question about whether HS2 would be a rich man's toy "perhaps slightly flippantly" and had pointed out that people who used the railways were usually better off than average workers.

'Slightly flippantly'

"Is the railway expensive? Yes it is. Is that because we have too high costs in our railway? Yes it is and the government is determined that with the rail companies and Network Rail we will tackle excessive costs in the railway and get the costs of running our railway down so it becomes more affordable for taxpayers and fare payers alike."

The government changed the formula for calculating rail fare increases from 2012.

For the past few years the formula for fare increases has generally been RPI inflation plus 1%, but for the next three years it is RPI plus 3% - pushing the cost of season tickets up by an average of 8% in the new year.

Stephen Joseph, of the Campaign for Better Transport said: "Philip Hammond's description of rail fares as 'eye-watering' must lead the minister to reconsider the steep fare rises currently planned by government.

"Far from being simply 'a rich man's toy' trains are also vital for many of those on more moderate incomes who need to get to work, and the government will price many off the railways if it carries on with its plan to increases rail fares at three per cent above inflation over the next few years."

Shadow Transport Secretary Maria Eagle said: "The real reason that our railway is becoming a rich man's toy is Philip Hammond's decision to allow rail fares to rocket by an average of 8% every year.

"This increasingly out-of-touch government has no idea of the cost of living crisis facing families up and down the country and the impact these rises are having on household budgets."

But train companies said they played a "key role" in the British economy, supporting jobs and businesses.

A spokesman for the Association of Train Operating Companies said: "We get millions of passengers from A to B every day - people from all backgrounds who travel on a range of different tickets.

"The average price paid for a single journey comes in at around £5 and the sale of cheap advance tickets has doubled in the last few years, with almost a million sold every week.

Virgin Trains, which runs services on the West Coast mainline, told the BBC there was a "wider range of value fares than ever before" on their services.