Today's news is nothing short of what was expected, especially after the government limited the rise in rail fares in January 2012, to continue subsidising rail fare rises each year goes not only against the political interest to make the railways more efficient but also against current governmental policy of allowing greater freedom for train operators....in spite of the 150+ page highly specified GW ITT.
There are some interesting debates which appear to be gaining traction in the aftermath of these reported rises in a few months, for starters, many are on wage freezes, unemployment is rising, and yet inflation is increasing, we are as the Campaign for Better Transport argues in danger of creating 'transport poverty'. This isn't of course unique to the railways, I've seen numerous examples of young jobseekers having to walk from their house miles to the town centre as they can't afford bus fares, JSA is £56 a week, which when you factor in £20 a week or so on a bus pass doesn't leave you with much to live on, but I digress. It can be argued that commuting is a lifestyle choice and that by choosing to live in say Bedford, whilst working in London you factor in increasing rail costs, but as the trends have shown people are having to work further and further from their homes and as mentioned increasing fares for what many see as a service that fails to meet the price they pay and service quality they expect looses goodwill to the railway and begin to question modal choice. I noticed recently National Express started running commuter coaches to Canary Wharf, it is not railway romanticism that makes people use trains to get to work, it is the most efficient and affordable option to many, but increasing rail travel costs begin to question this.
One of the real reasons for these rises in rail costs is that the railway is horrendously complicated and inefficient, it is hard to find out black and white figures of how much the railway really costs, the Dft for example recently claimed that the railways were making a profit of £500m in premium payments, but this ignored the PTE subsidy allocated to the TOCs and NR's grants. As an example of the inefficiency lets take a look East Coast, this company is owned by Directly Operated Railways, part of the DfT, it operates over Network Rail and duly pays them for that privilege, NR is of course a private company, although it is owned by HM Government. The trains that East Coast used were built for and paid for by British Rail, which itself was funded by HM Government, so just how much does this train operator (HM Government) pay to use the trains which British Rail (HM Government) bought outright years ago?
East Coast (HM Government) spent £81,000,000 in leasing costs for 2011.
To the credit of this Government they have accepted that the railway is inefficient and in danger as Phillip Hammond said of becoming "a rich mans toy", however the McNulty report focuses on the inefficiencies of staffing, but this was only 34% of costs for 2011 for ScotRail. This thread has made arguments about increasing cost of fuel...using the ScotRail example this was just 11%, whilst petrol costs are increasing so is the efficiency of motor cars, indeed as the OBR show in their next 50 year prediction HM Government set to loose some £68bn in transport taxes through this.
One of the main problems as Railtrack showed, is that operating costs of the railway can not cover capital costs, until we take the view that railways provide a social benefit and an improvement as are too important to fail, since they are used by so many we must either price people off the railways, whilst satisfying ourselves that the railways are self funding or we can increase taxes on business and property that benefits from railway investment, for those interested there are some very interested reports and books on the Jubilee Line Extension and the true costs including benefit to business.
Incidentally, for those suggesting Labour would do the same, remember that a lot of these commuter areas are in marginal seats come the next election and as recent policy think tanks have shown there is popular interest in renationalisation to improve efficiency, regulate costs and provide a publicly accountable railway. As a point of interest the RMT disaffiliated from the Labour Party in 2004.