RAIL passengers in England and Wales will pay higher fares during peak periods to help ease overcrowding as part of industry reforms aiming to save up to £3.5 billion a year by 2019.

A "command paper" published yesterday by the Department for Transport aims to loosen Government control over the rail industry by returning key decisions to private firms overseeing train services.

It was welcomed by train operators, got a cautious reaction from passenger groups and was condemned by the Rail, Maritime and Transport union.

Though the measures will not apply north of the Border, they are being closely watched by those trying to trim the £700 mil-lion annual bill for operating Scotland's rail network.

Transport Scotland, the Government agency responsible for rail, proposed similar cost-saving measures as part of the Rail 2014 consultation published last November, with final views expected later this year.