Almost half of UK rail fares, including most commuter journeys, are set to fall by 0.4% next year as  regulated rail fares, which also include long-distance off-peak journeys, are based on July's Retail Prices Index (RPI) figure, plus 1%. This has come in at  -1.4% in only just above the record low of -1.6% in June.

Transport Secretary Lord Adonis said. "For the first time in a generation passengers will see their fares fall"

This contrasts with last years July figure of 5%, which meant that rail prices rose by 6%.

Regulated fares make up 60% of rail journeys and up to 45% of rail fare income.

In 2010, the rules on regulated fares change, with most rail companies having the limit of RPI plus 1% imposed on them. Previously, train operators have been allowed to increase individual regulated fares by as much as 6% over the RPI rate.

"This means most regulated fares will fall in line with the national fare change, which will be welcomed by passengers," Lord Adonis said.

Regulated fares refer to weekly and monthly season tickets in commuter areas, where the Department For Transport (DFT) keeps prices in check by means of fares 'baskets' .

Two train companies, Southeastern and West Yorkshire PTE, are exempt from the change in rules and they will allowed to raise fares by 3% on top of the RPI rate from January to fund additional investment in services in those areas, the DFT said.

Rail fares have risen by 5% in real terms since 1997.

However there are concerns that unregulated rail fares will increase as train companies attempt to recoup the money lost from falling season ticket prices.

Some rail firms have raised fares by as much as 11% recently on advance ticket purchases. First Great Western announced increases of up to 20% on some off-peak services last week.

Hassard Stacpoole, spokesman for the Association of Train Operating Companies, said that train companies set the prices for unregulated fares in the autumn and suggestions of any price increases were "sheer speculation" at this point.

There have been fears that several train companies will not be able to afford cutting the price of fares and may run into financial difficulties.