Today”s (14 August) decision by the Department for Transport (DfT) to award the InterCity East Coast rail franchise to National Express Group, has raised concerns that ticket prices could rise sharply.
NXEC Trains, a subsidiary of National Express, will pay a net subsidy to the DfT during the seven and a half year franchise lifetime of ”1.4bn ($2.8bn), for the prestigious services that link London to the north of England and Scotland.
A DfT spokesman stressed to ABTN that: ”This is a premium, a net contribution and it is where we want to be with franchises.”
The contract is due to start on 9 December this year and takes over from previous operator, GNER, that lost its franchise after being due to pay the DfT ”1.3bn in contributions.
But National Express has come in for criticism from train watchdog, Passenger Focus, which maintains that some unregulated fares could see ticket prices soar by 45%.
The DfT notes that NXEC has said it may wish to increase unregulated fares by an average of inflation plus 2.1% each year during the course of the franchise, leading Passenger Focus manager, Guy Dangerfield, to comment: ”We are concerned that at current inflation rates, this could amount to a 45% price increase during the length of the franchise and could mean a York to London Standard Open Return, rising from ”179 to ”259 by 2015.”
Despite the fares attracting headlines, National Express is keen to point out the improvements it says it will deliver, such as 25 extra daily services adding approximately 14,000 seats from 2010 and the addition of 40 more carriages.
And although the government recently appeared to pour cold water on any high-speed north-south rail link, National Express says it will cut London-York times to 1h45min and add more services from the UK capital to Edinburgh with a journey time of around 4h20min.
The company will also plough ”7.4m into station upgrades with more car parking, while it has also committed to reduce fuel consumption per passenger kilometre by 28% during the franchise term.
”We want to grow and develop our rail network,” said rail minister, Tom Harris, adding: ”In our White Paper we set out plans to deliver increased capacity, better performance and improved connections between key towns and cities. There is provision in this contract for extra services and fewer delays.”
The government will continue to limit annual increases on regulated fares ” including season tickets and savers ” to inflation plus 1%. The last 17 months of the franchise will be conditional on set performance levels being reached.