Oral Answers to Questions

Maria Eagle Excerpts

Thursday 28th October 2010 Commons Chamber

[Mr Hammond]

As I said in my opening remarks, we have a problem with the cost base of our railway and in the medium term there is no doubt that the challenge for us is to get that cost base under control, so that we can ease the pressure on passengers and at the same time ease the pressure on taxpayers. However, in the short term, the decision that had to be taken was simple: do we go ahead with investment in additional rail vehicles to ease overcrowding and improve the passenger experience or do we not? We have taken the decision that investing for the long term is the right answer for the United Kingdom economy.

[Maria Eagle (Garston and Halewood) (Lab)]

It is good to be facing the right hon. Gentleman across the Dispatch Box for our first Transport questions. He again spent the last week all over the media, from “Newsnight” to “The Daily Politics”, pretending to be Chief Secretary to the Treasury, so I apologise to him for dragging him back to his day job. Why did he tell The Times that fares would rise by 10% over the spending review period when commuters are actually facing a hike in fares of 30% plus?

[Mr Hammond]

I welcome the hon. Lady to her place. Perhaps I cannot tell her and her sister apart and that is why I was responding to the shadow Chief Secretary earlier this week. She refers to a quote. On my arithmetic, RPI plus 3% for the last three years of the spending review period, with RPI plus 1% for next year equates to a 10% real-terms increase in the regulated average fare over the period of the spending review.

[Maria Eagle]

I have the quote in front of me. The right hon. Gentleman used a figure. He said this; it is in quotation marks, so he can tell me if he was wrongly quoted:

“If you are paying £1,000 for your season ticket now, it could cost you £1,100 at the end of the period”.

That is not saying that it is a real-terms increase of 10%. That is saying that it is an increase of 10% in total. His Government's own Office for Budget Responsibility predicts inflation of at least 3.2% from 2012. That will mean a rise of at least 6.2% a year, meaning that by 2014, fares will rise by over 30%. I would have expected better standards of arithmetic from someone who would rather be in the Treasury.

Let me try the right hon. Gentleman on another question. Why has he scrapped the cap on individual fares that we introduced? Does he understand that that will mean many fares rising by more than the 3% above inflation that he has allowed? Therefore, for the sake of hard-pressed rail users, who are already struggling thanks to other measures that the Government are taking, will he now abandon that stealth tax on commuters?

[Several hon. Members]

rose—

--- Later in debate ---

[Maria Eagle]

It’s a stealth tax.

[Mr Hammond]

It is not a stealth tax because companies are only allowed to increase regulated fares by a weighted average of 1% above RPI in the coming year across all the regulated fare pool.