According to the story the police were in charge of the ticketing
"Mr Osborne is understood not to have had any direct communication with Virgin Trains staff - and an officer from the Metropolitan Police, who was escorting the chancellor, is reported to have told the train manager in advance that Mr Osborne did not have the correct ticket."
"A spokesman for Virgin Trains said: "The chancellor was in first class with a standard-class ticket. It wasn't a dispute or even a discussion with him. An aide of his spoke to the train manager and asked to pay the upgrade. We're not aware of any dispute.""
He should obviously have gone by government limo.