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London cyclists at Hyde Park Corner (copyright Britishcycling.org_.uk).jpgChancellor urged to open up Cycle to Work Scheme to lower-paid and self-employed workers
Chancellor of the Exchequer Rishi Sunak is being urged to open up the Cycle to Work scheme to lower-paid workers and the self-employed.
The call to widen access to the scheme, which has now been running for two decades and enables people to gain tax breaks on purchases of bikes and accessories through salary sacrifice, has been made by the Cycle to Work Alliance as well as organisations including the Co-op, the Federation of Small Businesses, and British Cycling.
Other signatories to a letter sent to the Chancellor include the Chartered Institute of Payroll Professionals, the Forum of Private Business, and the Association of Independent Professionals and the Self-Employed. Copies were sent to ministers including Trudy Harrison who has responsibility for cycling at the Department for Transport.
The letter says that under current guidance for participation, access to the scheme, whose benefits have been enjoyed by millions of employees, is barred to those whose earnings are at or slightly above the National Minimum Wage, as well as people who are self-employed – groups they identify as having among the most to gain were they allowed to take part in it.
Paul Caudwell, Health Wellbeing Manager at the Co-operative Group, commented: “We’re Co-operating for a fairer world which includes doing what we can to make things fairer for our colleagues.
“The current legislation surrounding Cycle to Work schemes prevents us from giving our lower-paid keyworker colleagues access the same level of financial incentive, using a salary sacrifice arrangement, to use our cycle to work scheme.
“I believe that the legislation must change to allow a salary sacrifice arrangement to be able to reduce pay below the National Minimum Wage.
“This would make the incentives for using a salary sacrifice scheme more equitable for all of our colleagues and increase take-up of our cycle to work scheme.”
> You will now be able to get bikes worth over £1,000 on the Cycle to Work scheme
The letter was co-ordinated by the Cycle to Work Alliance, founded in 2010, and which brings together the five largest providers of the Cycle to Work scheme – Cyclescheme, Cycle Solutions, Evans Cycles, Halfords and Vivup – which collectively account for approximately 80 per cent of the market.
Last year, it published the findings of research which showed that one in three employees who had not previously participated in the scheme said that was due to their income being too low, meaning they could not take part. Meanwhile, one in 10 said that they were unable to participate due to their self-employed status.
The organisation says that “as part of steps to protect workers who opt to take their pay below NMW by joining the scheme, Alliance members will introduce a series of ‘safeguarding mechanisms’ to ensure the process remains clear and transparent.
“Safeguards include integrating cost calculators within the application process and a verification step to the application process, requiring applicants to confirm they have used the cost calculator and are aware that salary sacrifice payments could bring them below NMW.”
Labour has also given its support to the changes being called for, with Shadow Roads Minister Gill Furniss MP, saying: “The Cycle to Work scheme has been shown to make bikes more affordable and accessible to a wide range of people.
“They have a proven track record of encouraging those who have not cycled before to take up active travel.
“This delivers such a wide range of benefits, including improving people’s physical and mental health, improving air quality and easing congestion on our roads.
“There is no path to net-zero without green transport and it is vital Ministers do more to encourage people to cycle to work, increase access and take-up of this popular scheme.”
In the first six months of the coronavirus pandemic, from March to September 2020, members of the Cycle to Work Alliance saw a 60 per cent year-on-year increase in new members, with key workers in particular looking to switch to two wheels for their commute – for example, a 111 per cent increase in new participants among London Ambulance Service staff, 67 per cent in the Metropolitan Police and 47 per cent in Transport for London workers.
Simon joined road.cc as news editor in 2009 and is now the site’s community editor, acting as a link between the team producing the content and our readers. A law and languages graduate, published translator and former retail analyst, he has reported on issues as diverse as cycling-related court cases, anti-doping investigations, the latest developments in the bike industry and the sport’s biggest races. Now back in London full-time after 15 years living in Oxford and Cambridge, he loves cycling along the Thames but misses having his former riding buddy, Elodie the miniature schnauzer, in the basket in front of him.
Latest Comments
- andystow 1 sec ago
The new RH tubes claim to solve that issue, but price and availability is a problem. I tried to get some to try out, but they went out of stock on...
- henryb 12 min 16 sec ago
Disappointed this article doesn't use the words 'boondoggle', 'junket' or 'jamboree'
- brooksby 24 min 21 sec ago
Cough - cough - Clevedon seafront! - cough cough
- eburtthebike 42 min 12 sec ago
Thanks for the tip. I didn't realise the Forest of Dean was inside the M25.
- Adam Sutton 46 min 47 sec ago
Chances are you live in London or somehwere where you have decent public transport, to make such a dumb comment
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Those calipers arent the prettiest. Makes them look like Post-mount.
- Dnnnnnn 4 hours 37 min ago
I'm all for a much more socialist approach to the sorts of things you mention, where there are clear market failures and a need for decent...
- David9694 4 hours 38 min ago
Zorbing balls - if it saves just one life
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20 comments
Another prong to this is making bike servicing, repair and maintenance more accessible and less intimidating. I've met a few people for whom cycling was considered a 'fit and forget' activity and who immediately abandoned it when their bicycles needed maintaining. Not only does this mentality need to be addressed, but people could do with being educated about bike maintenance and local bike shops and mechanics need spotlighting and supporting.
It's all well and good making brand new bicycles easier to purchase, but what's going to happen to them in a year? Or five? Or ten? Are these just landfill fodder?
I feel like this UK government has a history of subsidising behaviours that encourage consumerism and short-term spending to show that they are 'addressing' the problem (see: Eat out to help out, Scrappage Scheme etc) but are so nearsighted that none of these are followed through properly and result in a swift fallout.
Community initiatives like Bristol Bike Project and Nottingham Bike Works are pulling the weight of accessible bike maintenance on their own, but this needs to be supported from the top down.
Does anyone know if the full letter is available to ordinary people? Or even to journalists - have Road.cc staff read the full letter or are they relying on a press release?
As far as I can tell, the sole proposal in the letter is "the legislation must change to allow a salary sacrifice arrangement to be able to reduce pay below the National Minimum Wage." There is no mention of how to better include self-employed people (some of whom can already use the scheme).
But I think there are far more fundamental problems with the current scheme:
There are numerous alternatives that would seem to be much more sensible:
Agreed word for word; although you rely too much on facts and logic and too little on emotion. I don't expect the ideas to get traction until you explain how this helps 'the hardworking majority seeking to go about their everyday lives.'
Some good points. An adult paid at NMW (£9.50/hr) and working full time 37.5hrs/week will earn £18k+ per year, plenty enough to save tax and NI.
Where it gets tricky if if the employee is younger and/or works fewer hours. The low pay commission estimates 7% of the UK workforce is paid at NMW so it's a big issue.
My solution is for the employer to raise the employees salary above NMW by the amount the employee wishes to spend on a bike, which of course will never happen.
Any reduction in VAT would give a short finanical boost but would soon be negated by price increases (bikes have gone up by 20% in the last year alone).
Not to say that the aforementioned groups dont deserve the option of CtW, but how about at the same time making it "opt-out" for employers rather than opt-in? My current one doesnt support it (presumably because they are a big French-American company) and just dont think about it - nudging them along would be helpful. I need an N+1
(It would probably even be a folder!)
I was lucky enough to be in a very well paid job a few years back which put me into a higher tax bracket than I had previously been in, I was suprised when I realised that of course these things actually benifit you more if you are a higher earner as it reduces your top line each month and hence the amount of the higher tax you need to pay. Just really rubs i in when it isn't availble to the lower earners at all.
If the government were really serious about getting people on bikes they could lower (or remove) VAT on bikes as well, the overall savings to the uk economy would outweigh the cost by far.
That's a great idea. I've never been able to make use of these salary sacrifice schemes as they seem overly convoluted and the company I work for figured it was too much hassle for them. (To be fair, I'm not really the target for these schemes as I already cycle).
Exactly what I was going to say. Reducing VAT benefits all and encourages people to make healthy choices.
Yup! Sign me up. One caveat - merely making bikes cheap (or even giving people them) doesn't make them cycle. People have to have somewhere that feels safe and is convenient for their journeys.
Cycling can be a virtuous circle but it's a bit hard to break into from where we are. The benefits come when you've got "mass cycling". I'm not sure what percentage of journeys that would be but at a few percent the UK's quite a long way from it. I think I definitely know it when I see it though.
Impediments: the government, civil servants, councils and some businesses. Many people just don't understand cycling, how it can help and how best to let it grow. It's actually not quite as easy as riding a bike. Sadly not only is government not serious about getting people on bikes. (Indeed almost no parties are). A sizeable fraction of those in positions of power feel that cycling is at best a "nice to have" irrelevance and there are a few who are utterly convinced it's actively harmful.
You are correct. Historically, the cost of buying a bike has not been in any of the reasons why people do not cycle:
https://www.cycling-embassy.org.uk/wiki/barriers-cycling
However, the rise of electric bikes will change this (see page 20 here):
https://drive.google.com/file/d/1Tlw0oH-dMm8b8cUT46Z0ryz2YhL3MxHg/view
Caveat: It's not immediately clear from any of that whether anybody was asked about cost. Some of them may have been open questions - can't really tell without digging deeper than what's there - but if they were asked to select reasons from a list we can't really conclude anything about factors that weren't included.
Assuming it's true, though - paradoxically, that doesn't necessarily mean that giving people bikes / subsidising purchases won't encourage people to cycle / cycle more. Because humans are weird like that.
We can be pretty confident it's not price. People were keen in China to get a Flying Pigeon even when it was really expensive AND you needed some contacts.
If you give people anything you'll probably see a temporary increase in use of that thing. The problem is wanting to modify the behaviour of most (or at least a significant minority) of people over the longer term. Additionally you might find that you did get more cycling for a longer period but now everyone now rides on footpaths / parks / the few car-free spaces and there's massive conflict with pedestrians / each other. And everyone still does all their previous car journeys by car.
So "no data"? Look for "natural experiments" - so look in other places or at different times. Wind back the UK clock and cycling was not just a major transport mode but the main one (by distance I believe. Sorry - I can't find the graph for that just now but see here and there's one since the 50's below). Bikes were cheaper than now but relatively more expensive I believe. But price wasn't the issue. Cars were not readily available to the masses in e.g. the 1920s and 1930s. The roads had become better and they weren't swamped by cars. So bikes were the most convenient mode for shorter journeys.
https://en.wikipedia.org/wiki/Modal_share#/media/File:Transport_modal_share_from_1952-2014.png
(Also at the government's site)
To be clear, I'm not saying that (a) price is stopping people cycling, or (b) cycle subsidy schemes will increase cycling (still less 'the right kind of cycling'). Only that (a) you can't conclude either from the information on that Cycling Embassy page, and (b) price not being a factor in people not cycling doesn't necessarily entail that subsidy can't result in more cycling (reduced price =/= same price + subsidy, because psychology).
In other words, I wasn't saying 'no data' - rather 'better data needed than what's been provided'.
Apologies - I did understand and meant to replace "no data" with "not conclusive" but missed it. I still think that cost - if not irrelevant - is clearly low on the list of reasons why everyone's not cycling already. I read somewhere (no ref, sorry...) that something like 40% of households already have bikes. Why aren't they cycling everywhere? I bet lots of kids have bicycles which they don't cycle to school on - why could that be? Cars cost more than bicycles - but people buy cars. (And cycling infra is a lot less costly than new roads...) I'd say UK history is a good enough example for us to move on to look at much more significant conditions for cycling first.
No changes to bikes alone (cheaper, more shops, electric assist, roof) will change the status quo in the UK - short of making something which is really a car. People will of course do expensive things they don't enjoy if it's the fashion. However they've been shown to vote with their feet when it comes to cycling (or indeed walking) in traffic. Most just won't cycle unless it feels safe ("subjective safety"). (I know as far as the numbers go it's actually a very safe activity even now in the UK.) And in the UK it currently feels unsafe plus inconvenient and people think you're odd.
So we need multiple things to happen which can reinforce each other. I agree that having better access to "bikes suitable for everyone" [1] [2] [3] [4] is part of the picture, as is making cycling for transport a normal thing in the culture or "desireable". Those won't do much in isolation though.
Agreed. But we've had new cycle infra built around the country for lockdown so it would be best if they were being used as much as possible in order to best weather the anti-cyclist backlash.
While most of that new infra needs improvement sadly if it isn't being used 'enough', for better or worse, it's more likely to be removed than improved.
And once that happens any mention of new proper cycle infra gets answered with "we already tried that and it didn't work."
I agree - but that's always been the sticking point. Chicken and egg of "nobody cycles, so why should we put in proper quality infra?". A counter is "latent demand" - Covid-times were an interesting "natural experiment" but unfortunately being exceptional in several different ways it's not going to convince people. Luckily we can always use the examples in several countries quite close by - helpfully at several different stages of development [1] [2] [3] [4] [5] [6].
But yes - sadly Covid-infra was not specifically bike infra and was always going to be compromised. It did nothing to change the mentality that cycling just needs "encouragement", or that you can get this done on a "footpath"-level budget, or it must be done without compromising access for motor vehicles (read - no change in capacity).
Parts!
Keeping the already used bicycles going, doing up the ones already owned and unridden, refurbishing the 2nd hand.
Double down on the environmentally soundness too.
That's what I should have said! No doubt someone more economically literate will be along to tell us this is akin to inviting "charity-shop blight" (because growth or nothing, right?) but for me reduce, reuse first. And actually in many places - out of need - second-hand, scavenging and fixing plays an important and useful role.
Props to my local one too: https://thebikestation.org.uk/edinburgh/