Updated: Monday, 13th July 2020 @ 9:36pm

Commuter misery: Rail prices in Manchester and UK set to soar – dwarfing current inflation rate

Commuter misery: Rail prices in Manchester and UK set to soar – dwarfing current inflation rate

By Mihaela Ivantcheva

Rail ticket prices next year are spiraling out of control as July inflation rose to 2.6%, leaving Greater Manchester commuters worried about their financial health.

Train tickets will increase by more than current inflation rate, Mancunians will see fares rise by a total of 6.2% starting from January.

Figures released yesterday by the Office of National Statistics showed that annual inflation as measured by the Consumer Price Index has increased as compared to previous months as well as the previous year, automatically leading to higher rail prices.

The Retail Prices Index rose from 2.8% in June to 3.2% in July, while Consumer Prices Index annual inflation increased to 2.6% in July, up from 2.4% in June.

This will have severe repercussions for commuters in England and Scotland as next year’s rail prices are calculated on the basis of July’s retail price inflation (RPI) figure by adding three percentage points to the July’s 3.2%.

Dr Brian Sloan, Chief Economist at Greater Manchester Chamber of Commerce, said: “All eyes were on the retail prices measure of inflation as it is this figure that will be used to calculate rail fare increases for the coming year.

“While the figure is much lower than the recent peak of 5.6%, typical rail fares will now increase by 6.2% adding to the burden faced by commuters who have already seen their incomes squeezed.”

It is said that the unexpectedly large rise in the latest rate of inflation was due to higher air fares and housing costs.

A lower monthly drop in clothing prices, due to earlier summer sales, also helped boost the headline figure.

Rail prices in some parts of England, including Greater Manchester, are set to increase by more than 6%. In Scotland, prices will go up by RPI plus 1%, while Wales has yet to set a figure for its increase.

“This reinforces our message that infrastructure improvements should have been funded through the Bank of England to stimulate domestic growth, as placing the burden on consumers at this time is likely to further damage demand,” Dr Sloan.

“Though we’re focusing on rail price increases this month, we should not lose sight of the fact that inflation is not continuing its recent falls and is unlikely to fall to below 2% as expected by the Bank of England only last week.”

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