Grayling accused over bid to move away from RPI to set rail fare increases

The Transport Secretary has sparked anger after telling rail unions he wants to move the industry away from basing increases on RPI inflation, including pay rises.

Chris Grayling wrote to union general secretaries amid the row over the use of RPI to set next year's rail fare rises instead of the lower CPI.

Union leaders accused him of trying to cap pay rises in the industry.

Labour said it was a "pathetic attempt" to shift the blame for Tory fares policies.

Inflation figures will be published on Wednesday, leading to controversy over whether fares should increase at all given the disruption faced by passengers in recent months.

The letter said: "I am aware that you have raised concerns about the level of increases in recent years, and I share your desire to see lower levels of increase for passengers in future.

"A key part of achieving this without additional burden on taxpayers will be to ensure that costs in the industry rise no faster than ticket prices.

"This will require a move away from the use of the Retail Prices Index in the way the industry operates to the more commonly used Consumer Prices Index.

"I have already taken steps to ask the Office of Rail and Road to move away from the use of RPI in the contractual and regulatory structures that the industry uses.

"This will be part of the next regulatory period, which starts next year.

"However as you will be aware, one of the industry's largest costs is pay. I support paying rail staff decent wages for the hard work they do, but I also now believe it is important that pay agreements also use CPI and not RPI in future when it comes to basing pay deals on inflation."

Rail, Maritime and Transport union general secretary Mick Cash said: "If Chris Grayling seriously thinks that front-line rail workers are going to pay the price for his gross incompetence and the greed of the private train companies he's got another think coming.

"This is a basket-case Government and a lame-duck Transport Secretary continuing i?ts all-out war on staff and passengers alike.

"RMT will fight any attempt to impose a pay cap on our members in a drive to protect private train company profits."

Rail fares
(PA Graphics)

Andy McDonald, shadow transport secretary, said: "The amount by which train companies can raise regulated fares is the responsibility of the Transport Secretary.

"This is a pathetic attempt by Chris Grayling to shift the blame for Tory fares policies. He has the power to enforce this, he's just choosing not to.

"If the Secretary of State recognises that train companies' profits are responsible for sky-high fares, instead of asking them to make less money, why not go one step further and end privatisation altogether?

"The truth is that our fragmented, privatised railway drives up costs and leaves passengers paying more for less."

Paul Plummer, chief executive of the Rail Delivery Group, said: "For every pound paid in fares, 98p goes back in to running and improving the railway. We are ready to work with all parts of the rail industry to improve value for money for our customers."

The Government is expected to continue to use RPI to set regulated fare increases unless salary increases are switched to CPI.

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