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Steep increases in rail fares could hit small businesses hard, increasing costs directly and eroding the real wages of commuting staff.

The New Year sees most fares increase, and this year is no different, with ticket prices on regulated routes rising by an average of 4.8 per cent.

However, on unregulated routes, the average price rise is an inflation-busting 11 per cent.

SMEs, whose staff are less likely to have company cars than employees working for big firms, are likely to be the principle business victims of the train companies' policies.

Consumer watchdog Passenger Focus chief executive Anthony Smith has hit out at the rail industry.

He says: 'Train companies that are not delivering a quality service should freeze their prices. Passengers who are not getting what they paid for must complain to their train company.'

Association of Train Operating Companies (ATOC), which represents the rail companies, insists that the fare rises are necessary to fund infrastructure improvements.

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