Transport poverty 04 Mar 2013

800,000 homes spend more than a quarter of their income on running a car

The poorest ten per cent of car-owning households in the UK are mired in transport poverty and are spending at least 27% of their disposable income on buying and running a vehicle.

This equates to roughly 800,000 homes.

By contrast, those in the wealthiest car-owning households are spending around 12% of their disposable incomes on purchasing and operating a car.

Of a total weekly expenditure of £167, those in the poorest car-owning households see £44 go on vehicle-related purchasing and operating costs.   

Of the £44, £16 is used to buy petrol and diesel and £8.30 is spent on insurance.

The high level of expenditure is revealed in analysis of previously unreleased data from the Office for National Statistics which has been seen by the RAC Foundation.

Professor Stephen Glaister, director of the RAC Foundation, said:

“These figures should shock the Chancellor. We already knew transport was the single biggest area of household expenditure bar none. But this spending breakdown just for car-owning households is not normally available. It lays bare the truth about the extent of transport poverty in the UK.

“There is understandable concern about home owners having to spend more than 10% of their money on heating their houses. But to most of us transport is another essential item and our outgoings on getting about eclipse all other domestic bills.

“George Osborne will soon deliver his budget and is likely to tinker with the rate of fuel duty. For people already drowning under the weight of motoring costs, cutting a penny or two off the price of a litre of fuel will help but is like rearranging the deck chairs on the Titanic - ultimately futile. To make any meaningful difference to those on the lowest incomes the rate will need to be cut much further.”

ENDS

Contacts:

Philip Gomm – Head of External Communications – RAC Foundation

020 7747 3445 | 07711 776448 | 020 7389 0601 (ISDN)

Note to editors:

The RAC Foundation is a transport policy and research organisation which explores the economic, mobility, safety and environmental issues relating to roads and their users. The Foundation publishes independent and authoritative research with which it promotes informed debate and advocates policy in the interest of the responsible motorist.

In November 2012 the Office for National Statistics published the Living Costs and Food Survey for 2011. The published results showed that of average household (car and non-car owning alike) expenditure of £483.60 per week, transport was the highest at £65.70 (14%):

http://www.ons.gov.uk/ons/rel/family-spending/family-spending/family-spending-2012-edition/sum-headlines.html

It was only upon request that the RAC Foundation obtained from the ONS data relating only to car owning households.

The breakdown of expenditure by car-owning households by disposable income decile shows that of a maximum weekly spend of £167, the following was spent on (pounds in first column, percentage of weekly expenditure in second).

7.1

Purchase of vehicles

10.00

6%

 

7.1.1

Purchase of new cars and vans

[0.30]

0%

 

 

7.1.1.1

Outright purchases

-

 

 

 

7.1.1.2

Loan/Hire Purchase of new car/van

[0.30]

0%

 

 

 

 

 

 

 

7.1.2

Purchase of second hand cars or vans

8.50

5%

 

 

7.1.2.1

Outright purchases

7.40

4%

 

 

7.1.2.2

Loan/Hire Purchase of second hand car/van

[1.10]

1%

 

 

 

 

 

 

 

7.1.3

Purchase of motorcycles

[1.20]

1%

 

 

7.1.3.1

Outright purchases of new or second hand motorcycles

0.80

0%

 

 

7.1.3.2

Loan/Hire Purchase of new or second hand motorcycles

-

 

 

 

7.1.3.3

Purchase of bicycles and other vehicles

[0.40]

0%

 

 

 

 

 

0%

7.2

Operation of personal transport

22.70

14%

 

7.2.1

Spares and accessories

[1.10]

1%

 

 

7.2.1.1

Car/van accessories and fittings

[0.00]

0%

 

 

7.2.1.2

Car/van spare parts

[0.20]

0%

 

 

7.2.1.3

Motorcycle accessories and spare parts

[0.90]

1%

 

 

7.2.1.4

Bicycle accessories, repairs and other costs

[0.00]

0%

 

 

 

 

 

 

 

7.2.2

Petrol, diesel and other motor oils

16.00

10%

 

 

7.2.2.1

Petrol

11.40

7%

 

 

7.2.2.2

Diesel oil

4.60

3%

 

 

7.2.2.3

Other motor oils

[0.00]

0%

 

 

 

 

 

 

 

7.2.3

Repairs and servicing

4.80

3%

 

 

7.2.3.1

Car or van repairs, servicing and other work

4.70

3%

 

 

7.2.3.2

Motorcycle repairs and servicing

[0.10]

0%

 

 

 

 

 

 

 

7.2.4

Other motoring costs

0.80

0%

 

 

7.2.4.1

Motoring organisation subscription (e.g. AA and RAC)

[0.20]

0%

 

 

7.2.4.2

Garage rent, other costs (excluding fines), car washing etc.

[0.20]

0%

 

 

7.2.4.3

Parking fees, tolls, and permits (excluding motoring fines)

0.30

0%

 

 

7.2.4.4

Driving lessons

[0.10]

0%

 

 

7.2.4.5

Anti-freeze, battery water, cleaning materials

[0.10]

0%

 

 

 

 

 

0%

7.3

7.3.4

7.3.4.6

Hire of self-drive cars, vans, bicycles

-

 

 

 

7.3.4.7

Car leasing

[0.80]

0%

 

 

 

 

 

 

 

12.4.3

12.4.3.1

Vehicle insurance

8.30

5%

 

 

 

 

 

0%

13.2

Licences, fines and transfers

2.60

2%

 

13.2.1

 

Stamp duty, licences and fines (excluding motoring fines)

[0.10]

0%

 

13.2.2

 

Motoring fines

-

 

 

13.2.3

 

Motor vehicle road taxation payments less refunds

2.50

1%

 

 

 

 

 

 

Total motoring expenditure

44.40

27%

Figures in square brackets [] indicate that, out of the overall sample, there were only a limited number of respondents to these questions. Where there is a dash – it means there were no reporting households.

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