Rail passengers will face fare rises well above the inflation rate in the new year, it was announced today.

Regulated fares, which are fixed at inflation rate plus 1 per cent and which cover season tickets and saver tickets, will rise 3.9 per cent from January 2. Unregulated fares, which include cheap day returns and some advance-purchase fares, will be rising by an average of 4.5 per cent.

The highest rises are on unregulated fares on the East Coast Main Line run by the GNER train company. These are going up by average of 8.8 per cent - about four times the rate of inflation. The next highest average unregulated fare rises are on Central Trains, up 6.4 per cent, Silverlink, up 6.1 per cent and Midland Mainline, up 6 per cent.

The smallest rises are on Merseyrail, where both regulated and unregulated fares are going up by an average of 2.9 per cent.

Some of the sting will be taken out of the regulated fare rises by the fact that season ticket holders will be getting discounts for their companies’ poor performance. These discounts will be as much as 10 per cent on some routes, with the majority of companies making 5 per cent discounts.

George Muir, the director general of the Association of Train Operating Companies (Atoc), which announced the fares today, said: "We need the revenue from fares to pay for the big improvements being made to the railways. Our railways are the fastest growing in Europe and operators will continue to introduce new trains, better passenger facilities and improved travel information."

The chief executive of the Rail Passengers Council, Anthony Smith, said: "These inflation-busting price hikes are a disappointing early Christmas present for passengers. The rail industry is going to have to work hard to demonstrate that these rises represent value for money.

"Good value rail travel can be had - if you can get hold of the tickets in advance. But many walk-on fares are now at eye-watering levels. A £202 ticket for return travel between Manchester and London bought on the day means passengers are paying nearly £50 an hour for the privilege of taking the train."

• The threat of strikes that would have devastated London Underground services in the days immediately before Christmas was lifted today. The biggest rail union, the RMT, called off a strike by 1,800 staff working for the private maintenance company Metronet after reaching an agreement over outsourcing, redundancies and pensions. The workers had been poised to take action on three of the days in the week leading up to Christmas.