Proposals for a new rail fares policy which could lead to ticket price rises were announced today by the Strategic Rail Authority.

The authority's chairman Richard Bowker warned that "some tough decisions have to be made".

The SRA document also spoke of the need to balance passengers' desire for lower fares with the need for the rail industry to combat rising costs.

But the authority pointed out that today's document was a consultation paper and said no firm decisions would be taken until next summer.

That means any fare increases will not take effect until January 2004.

At present some fares, including London and South-East England commuter fares, are regulated. London fares are linked to an inflation formula and to individual train company performances.

In its document today the SRA said it was considering changing the inflation formula used to cap commuter fares.

It also said the "existing automatic link between fares and performance has not worked well".

Another type of fare that is regulated is the turn-up-and-go off-peak Savers ticket.

The SRA hinted that this could change as regulation "may have led to overcrowding on certain services".

It went on: "We want to get more people travelling by train - but we also want to reduce overcrowding. Government resources are limited - should we use these resources to subsidise fares through greater regulation, or would they be better spent on directly improving the network?"

Fares account for £3.5 billion a year - which is just over half the operating costs of the railway.

Mr Bowker said commuter fares in the South East had risen by less than 16 per cent since 1995, compared with inflation of about 19 per cent.

Gina Field, of the Hassocks Amenity Association, said: "Last year when the association did a survey people did not want increases in fares.

"They wanted improvements but they did not want the cost of improvements lumped on to the ticket prices.

"I don't think it is justified because of the disgusting state of the trains, the lack of safety, the frequent slow running of trains and the awful new timetable which does not give us enough stopping trains to go to Victoria.

"The whole thing is a nightmare. I used to have to travel up and down every day and now I feel sorry for those that still have to."

Richard Moon, of the Haywards Heath Society, said: "I suppose many of the trains that run from Haywards Heath during rush hour are certainly full and the services have to be paid for whether they are run by a state body or a private concern.

"But a balance has to be struck between ticket prices and pushing people into their cars and on to the road.

"In my opinion the trains do represent good value but if the rises are jumping wildly ahead of inflation then it may seem a bit unfair."

A spokesman for South Central said: "We will be looking carefully at the SRA's document.

"Nothing is concrete yet. It is an opportunity for all interested parties to just have their say."