Rail Fare Report Welcomed By Hammond

Inflation busting rises in rail fares could become a thing of the past if the £1bn annual cost savings in the railways envisaged in a report published today are achieved, the Government has said.

Responding to Sir Roy McNulty’s independent Rail Value for Money study, Transport Secretary Philip Hammond welcomed the report and emphasised the need to reduce the cost of our railways.

The recommendations of Sir Roy’s highly detailed report entitled “Realising the Potential of GB Rail” will now be considered and will feed into Government proposals to reform the rail industry to be published later in the year.

Philip Hammond said: “Unless we get a grip and cut the costs of our railways, passengers could see services cut and fares rise. But, if we seize this opportunity, work together, and push through real reform in our railways we will be able to make savings for both taxpayers and fare payers.

“If Sir Roy's target of £1bn per year of savings is achieved, over the next few years, our aspiration should be to put the era of the above-inflation average rises in regulated fares behind us, as well as reducing levels of taxpayer subsidy. If we are going to achieve this goal we will need everyone involved in the industry, Network Rail, train companies, Unions and Government, to work together and I look forward to beginning that process.”

Last year Sir Roy McNulty was commissioned to conduct an independent study into rail value for money. His December 2010 interim report set out a preliminary assessment of the costs of rail in Great Britain and an estimate of savings of up to £1bn that could be achieved without the need of cutting services.

Today’s final report sets out his recommendations for improved efficiency and value for money in the rail industry. The Government will now consider which of Sir Roy's recommendations to take forward and on what timescales, and is developing a wider package of rail reform to secure a sustainable railway at lower cost that delivers a better deal both to the taxpayer and to the fare payer.

(BMcN/GK)