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East Coast main line fares to rise by 5%

Despite the fact that there is already a strict pricing formula in place for the UK rail network it seems that the UK government were blast this to pieces with a 5% increase in fares on the East Coast main line. This is the franchise which was given up buying National Express, after the company failed to balance its books, and has now reverted back to government control.

Even though the government has created a holding company which will trade at arms-length from the authorities themselves, there is no doubt that concerns about government intervention and influence are growing. The problem with many rail franchisees is the fact that they are unable to increase ticket prices with inflation, depending upon which measurement you use, falling into negative territory. However, the government appears to be set to rewrite this formula with regards to the East Coast main line.

This would appear to open the floodgates for other franchisees across the UK to ask for a reassessment of the ticket pricing formula at a time when investment requirements have increased, passenger numbers have fallen and turnover and profitability are under pressure. Quite how the government would justify refusing such a review is debatable in the midst of rumoured increases coming to the East Coast main line.

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