Think tank urges government to start tracking transport poverty
Transport costs are keeping 5 million people in the UK below the poverty line, according to a first-of-its-kind model for tracking transport poverty developed by the Social Market Foundation (SMF) think tank.
SMF defines transport poverty to be when a household’s spend on private and public transport pushes them below the poverty line. SMF’s new metric found that out of a total of 13 million individuals in poverty today, relieving them of their transport costs would lift five million of them – that’s 8% of the UK population – above the poverty line.
SMF says unlike fuel poverty, which is a well-established concept and is used by national and devolved governments to shape their policies, there is no robust equivalent for understanding the causes, locations, and depth of poverty due to transportation costs. And despite the high toll transport takes on household budgets, government has not yet introduced a metric for it, which could be used to help policymakers better target transport policies.
According to the SMF model, cars are the most expensive mode of transport, costing the median British household over £5,650 per year in upfront costs, maintenance, fuel, and additional fees.
Yet despite over £100 billion spent on cuts and freezes to fuel duty, the analysis finds this has little impact on transport poverty. SMF estimates the total impact of those policies over the past dozen years has been to cut transport poverty by just 0.3%.
This, SMF points out, is because driving is expensive but less than a fifth of that expense is caused by government taxes and charges. Even a drastic cut to fuel duty would not alleviate the burden of transport costs.
SMF suggests that government has effectively coddled drivers, inadvertently hurting them with policies that end up encouraging car use. The bigger issue, it argues, is a lack of investment in alternatives to driving is keeping people reliant on cars.
For every 10% increase in public transport journey relative to motoring in England, the average household pays over £400 more for transport each year – as they are forced to use cars, the most expensive mode of transport, in order to reach key services.
Broadly the regions that rely most heavily on cars have the worst public transport and tend to have the highest transport poverty rates. SMF analysis found that the North West has the most individuals in transport poverty (800,000), though a higher proportion of people in the North East (12.5%) and West Midlands (11.9%) are affected. This compares to just 4% in London.
In the long term, if the Government is to eliminate transport poverty, the SMF recommends the following measures:
The Department for Transport should begin tracking transport poverty and determine a cost ceiling beyond which households are considered in need of support with transport costs.
Policymakers should allow fuel duty rates to rise or replace fuel duty with road pricing to provide a stable source of funding
Direct new funding and devolve decision making at the local level, to deliver on both short-term (bus networks) and long-term (passenger rail) plans of increasing in public transport infrastructure.
Consider and introduce policies – like direct tax subsidy or social leasing – to increase access for electric vehicles by reducing the upfront costs
Gideon Salutin, researcher at SMF said, “Transport is the single greatest household expense for rural homes and the second biggest for urban ones. But we still don’t understand those struggling to pay for it the way we understand other forms of poverty like housing and heating. Understanding and tracking transport poverty is a long overdue endeavour.
Fuel duty gets all the headlines, especially now that so many policymakers have convinced themselves that they have to defend motorists from fictional attacks. Yet it is far from the best tool at their disposal if they really want to help the hard pressed. Our research shows that transport poverty can be rigorously tracked, and therefore can be alleviated – but only by investing in public transport and making alternative private transport like electric vehicles cheaper.”
Silviya Barrett, from national charity Campaign for Better Transport, added “We’ve known for a long time that a lack of good, affordable public transport is forcing people into expensive car ownership which puts a huge strain on household budgets, so it’s good to see this research quantifying the problem. We support the report’s conclusion that government investment in public transport is more beneficial to improving people’s life chances, helping households with the cost of living and levelling up the economy than lowering the cost of driving.”