Five questions answered on the annual rail fare rises

Risen three times faster than average incomes since 2008.

Annual rail fare rises take effect today. We answer five questions on the annual commuter price hike.

How much have rail fares increased by?

On average, fares have increased by 4.2 per cent.

Though it varies for different rail operators, overall ticket prices have increased by 3.9 per cent in England, Wales and Scotland.

How are rail fare price rises calculated?

They are calculated using the Retail Prices Index (RPI) measure of inflation plus an additional percentage.

The additional percentage added to the RPI was reduced in October last year from 3 per cent to 1 per cent by the government making a total of about 4.2 per cent.

Any fares that go up more than the average must be balanced by others that rise by less than the average, or that fall.

How does the rise in rail fares compare with the rise of people’s income?

According to the Trades Union Congress (TUC) average train fares have risen nearly three times faster than average incomes since 2008.

Which fares have been affected the most?

London commuters using the busses, tube, trams and DLR can expect to pay 4.2 per cent more today than yesterday.

One steep rise is an unregulated return between Birmingham and London which went up by 10 per cent, although this actually only adds £2.50 to the fare.

An off-peak day return between Bristol and St Austell in Cornwall is now £75.60 - a rise of 40 per cent - from £53.10.

Although, some tickets have only risen by as little as 2.3 per cent with one ticket from Shenfield, Essex, to London now £16 cheaper, after a 0.6 per cent drop.

What have the TUC said?

Frances O'Grady, general secretary of the TUC and chairwoman of Action for Rail, told the BBC: "At a time when real wages are falling and household budgets are being squeezed, rail travellers are being forced to endure yet another year of inflation-busting fare increases.

"As well as having to shell out record amounts of money for their tickets, passengers also face the prospect of travelling on trains with fewer staff and having less access to ticket offices. They are being asked to pay much more for less."

Annual rail fare rises take effect today. Photograph: Getty Images

Heidi Vella is a features writer for Nridigital.com

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I was wrong about Help to Buy - but I'm still glad it's gone

As a mortgage journalist in 2013, I was deeply sceptical of the guarantee scheme. 

If you just read the headlines about Help to Buy, you could be under the impression that Theresa May has just axed an important scheme for first-time buyers. If you're on the left, you might conclude that she is on a mission to make life worse for ordinary working people. If you just enjoy blue-on-blue action, it's a swipe at the Chancellor she sacked, George Osborne.

Except it's none of those things. Help to Buy mortgage guarantee scheme is a policy that actually worked pretty well - despite the concerns of financial journalists including me - and has served its purpose.

When Osborne first announced Help to Buy in 2013, it was controversial. Mortgage journalists, such as I was at the time, were still mopping up news from the financial crisis. We were still writing up reports about the toxic loan books that had brought the banks crashing down. The idea of the Government promising to bail out mortgage borrowers seemed the height of recklessness.

But the Government always intended Help to Buy mortgage guarantee to act as a stimulus, not a long-term solution. From the beginning, it had an end date - 31 December 2016. The idea was to encourage big banks to start lending again.

So far, the record of Help to Buy has been pretty good. A first-time buyer in 2013 with a 5 per cent deposit had 56 mortgage products to choose from - not much when you consider some of those products would have been ridiculously expensive or would come with many strings attached. By 2016, according to Moneyfacts, first-time buyers had 271 products to choose from, nearly a five-fold increase

Over the same period, financial regulators have introduced much tougher mortgage affordability rules. First-time buyers can be expected to be interrogated about their income, their little luxuries and how they would cope if interest rates rose (contrary to our expectations in 2013, the Bank of England base rate has actually fallen). 

A criticism that still rings true, however, is that the mortgage guarantee scheme only helps boost demand for properties, while doing nothing about the lack of housing supply. Unlike its sister scheme, the Help to Buy equity loan scheme, there is no incentive for property companies to build more homes. According to FullFact, there were just 112,000 homes being built in England and Wales in 2010. By 2015, that had increased, but only to a mere 149,000.

This lack of supply helps to prop up house prices - one of the factors making it so difficult to get on the housing ladder in the first place. In July, the average house price in England was £233,000. This means a first-time buyer with a 5 per cent deposit of £11,650 would still need to be earning nearly £50,000 to meet most mortgage affordability criteria. In other words, the Help to Buy mortgage guarantee is targeted squarely at the middle class.

The Government plans to maintain the Help to Buy equity loan scheme, which is restricted to new builds, and the Help to Buy ISA, which rewards savers at a time of low interest rates. As for Help to Buy mortgage guarantee, the scheme may be dead, but so long as high street banks are offering 95 per cent mortgages, its effects are still with us.