I'm sorry if I have missed it, but EXACTLY what type of Railcard does the OP have?
The New Deal Card is no longer valid for discounts and will not be accepted. The Discount Codes associated with the New Deal Card have been removed from retail systems from the new year.
The Jobcentre Plus Travel Discount Card is now the only valid card. This uses a different discount code, although there was an overlap in time when the new card used the old codes.
If the OP still has a New Deal Card then the office is correct, it is no longer valid.
If the OP has a Jobcentre Plus Travel Discount Card then this is valid, but uses a different discount code. The booking office should be advised to read The Manual on the TIS, where the information is clearly given. In fact it is still currently on the front page.
The following is from The Manual, dated 5th January 2012:
The Manual said:
Jobcentre Plus Travel Discount Card (formerly New Deal card)
The former New Deal card was renamed the Jobcentre Plus Travel Discount Card from Tuesday 1 November 2011. New Deal cards should no longer be in circulation and must not be accepted for discounted travel.
Jobcentre Plus Travel Discount Card holders receive exactly the same discounts as the former New Deal card holders.
Applying the discount to tickets:
To apply the Jobcentre Plus Travel Discount please use discount code JCP.
Discount description on tickets:
Tickets discounted with the Jobcentre Plus Travel Discount Card will have JCP printed on the tickets. Only the Jobcentre Plus Discount Card should be accepted in support of this discount.
See the Jobcentre Plus Travel Discount Card listing under Railcards & Concessionary Travel for further details.
As regards a Penalty Fare, I would say it is correct to issue a penalty fare in this case as no excess fare had been obtained prior to travelling over distance.
National Rail Conditions of Carriage said:
18. If you travel further than a ticket allows
If you travel beyond the destination shown on the ticket, you will be treated as having
joined the train without a ticket for that additional part of your journey. The relevant parts
of Condition 2 or 4 will apply for that additional part of your journey.
3. Where the full range of tickets is not available
If you cannot buy an appropriate ticket for the journey you want to make because the
range of tickets that is available at the station from which you intend to start your journey
is restricted, you must buy a ticket or Permit to Travel before you travel that entitles you to
make at least part of the journey. Then you must, as soon as is reasonably practicable, buy
an appropriate ticket to complete your journey. In these circumstances, you only need to pay
the fare that you would have paid if you had bought a ticket immediately before your journey.
The price you will have to pay will be reduced by the amount paid for the ticket or Permit to
Travel.
4. Penalty Fares
Penalty Fares are charged by Train Companies at some stations and in some trains. You
may be liable to pay a Penalty Fare if:
(a) you travel in a train without a ticket or Permit to Travel; or
(b) you travel in a class of accommodation for which the ticket is not valid; or
(c) you travel in a train and the circumstances set out in any of Conditions 10,
11, 12, 18, 19, 22, 30, 35 and 39 apply; or
(d) you are present in a Compulsory Ticket Area without a ticket or Permit to
Travel
Now, if the OP had visited the ticket office at Rainham that morning, and had produced a Jobcentre Travel Discount Card, and had been told that they could not issue a ticket using that card then I would argue he was covered under condition 3. However, he didn't do this. The clerk that morning may have been different to the previous day, and may have known about the change. Or it might have been the same clerk who had looked it up later and now knew how to do it. There is no way of knowing.