Prime Minister Andy Burnham has indicated a potential reduction in rail fares, stating the cost of train travel is "outrageous" and "in my sights." These comments come as Chancellor John Healey acknowledges that the ongoing crisis involving Iran is placing a significant strain on the nation's public finances.
Burnham's remarks, made in an interview with the Mirror, emerge amidst increasingly negative economic indicators. Soaring energy prices, attributed to the Iran conflict, coupled with sluggish economic growth, present substantial challenges for Healey's upcoming budget on October 28. The situation has been further complicated by a series of previously announced, seemingly unfunded policies, including a 5% VAT reduction on electricity bills and a cap on single bus fares at £2.
Earlier in the week, Burnham and Healey communicated to their Cabinet ministers that no additional funds would be allocated to their departments. The extent of the financial shortfall and the challenging international climate have raised concerns about potential tax increases, even with the tax burden already projected to reach record levels.
Burnham is reportedly examining various measures to alleviate cost-of-living pressures. "I think rail fares are too high, outrageously so in some instances. So that's something that's in my sights," he said. He also mentioned potential actions regarding water bills, suggesting the public pays high prices without seeing sufficient investment in infrastructure. Additionally, Burnham indicated he would review standing charges on utility bills as part of efforts to assist individuals facing financial difficulties.
Healey, meanwhile, has stated his intention to monitor supermarket pricing to prevent price gouging, particularly concerning fuel costs impacted by the Iran conflict. "Being frank, we can't completely stop the squeeze that families and businesses will feel with a global shock of this scale," he admitted, while vowing the government would remain "active" and "hands on" to support the public.
The crisis involving Iran has led to a significant increase in fuel costs after the nation reportedly cut off access to the Strait of Hormuz, a critical shipping route for oil and gas. Petrol prices have reached their highest point since 2022, with unleaded fuel costing approximately 160 pence per litre.