Consumer: Branson's cheap rail deals become rather expensive

Entrepreneurial flair was supposed to rescue Britain's unloved railways. But when Richard Branson, the Virgin chief, tinkered with his tickets he found himself in trouble with the rail regulator. Randeep Ramesh, Transport Correspondent, explains why Virgin Trains' big idea may be derailed. Through train services such the high-speed England-Scotland routes (pictured) will be affected. Photograph: Brian Harris

Virgin CrossCountry fares, promoted as the inexpensive alternative to the car, were once cheaper than the shorter trips through busy London stations which required passengers to change trains. However, many of its Super Saver tickets are now, according to the company, "redundant" following a price hike of 15 per cent.

The rise - nearly six times inflation - by Virgin CrossCountry on rides from England to Scotland using the cheap tickets, which can be used on any day except Fridays and summer Saturdays, angered rail pressure groups. Jonathan Bray, campaigns director of Save Our Railways, said: "We warned that these unprotected fares would disappear as ruthless operators decide that they are simply unprofitable."

The company's latest move brought a terse response from the rail regulator's office, following reports that clerks at stations had inadvertently sold passengers the recently-invalidated tickets - unaware that there were now cheaper alternatives. A spokeswoman for the rail regulator said: "We will be writing to Virgin seeking an explanation. As far as what has been sold, we need the evidence before we proceed."

Richard Branson's rail company has been quick to market itself as an inexpensive, high-quality service. It claims that its pounds 25 return apex fare - which needs to be booked seven days in advance - from London to Scotland is the cheapest ever on the railways.

Barry Doe, the transport consultant who discovered the tickets' disappearance, said that the price rise would affect "hundreds of fares". He cited a number of examples to prove his point. These included: a trip from Winchester to Edinburgh - whose Virgin fare is now pounds 92.20 and therefore obsolete, given the alternative is only priced at pounds 79; the same applies to the Virgin ticket from Southampton to Glasgow, which now costs pounds 95.80 as opposed to the once more expensive trip through London which is priced at pounds 82 and can be used on the same through-route.

When contacted, a spokesman for Virgin said that the tickets were still being sold - but hastily retracted the statement. "For now the tickets can not be purchased. But they remain in the manuals because, who knows, we may want to reduce them in the future."

The increases are being brought in on all "Anglo-Scottish" fares controlled by CrossCountry. This will affect cheap returns to Scotland from Wales, the South West and most of the Midlands and the North-west.

Mr Branson, who took over the running of pounds 100m CrossCountry services last year, has to increase ticket sales by 10 per cent in order to make the line profitable. His business plan is based around airline-style marketing. This means that a number of low-cost tickets have been heavily promoted by the company - but all require passengers to book their journey at least a day early and to specify outbound and return trains.

However, senior civil servants said that Virgin's move was more "cock- up than conspiracy".