Rail fares are set to rise by 3.5 per cent in January 2015 following the confirmation of the latest inflation figures.

Under the formula, fares in England and Wales are due to go up by July’s retail price index measure of inflation, plus one per cent.

RPI stood at was 2.5 per cent last month, according to figures from the Office for National Statistics released today, prompting the decision.

Under a policy implemented under the previous Labour government, regulated fares have increased by more than the rate of inflation in most years since 2004.

Labour today accused the government of “ripping off” passengers, but the government defended the rise.

Under a “flex” rule, train companies can raise fares by two per cent above the average, as long as the overall average stays at RPI plus one per cent.

As a result, some fares could increase by 4.5 per cent next year.

The Department for Transport defended the rise.

Transport secretary Patrick Mcloughlin said: “We fully recognise there’s more to do to bring down the cost of rail travel in Britain.

“But we need to do it responsibly and we can’t spend money we don’t have.”