Rising commuting costs force budget cuts, finds PwC
The research found that over half of respondents say their transport costs have risen in the past year with many cutting back on essentials such as utilities, savings and leisure activities to offset the rise. In London this was 53% but in some areas, such as Northern Ireland, 70% have cut back.
Of all full-time workers surveyed, 59% say their monthly costs have increased, in London it’s 59%. More than a quarter of those in the capital (27%) who have seen their transport costs increase cut back on long term savings and about one in three have cut back on eating out.
Socialising, holidays and treats for children were all scaled back by respondents nationally and regionally. Of those that have seen transport costs rise over the past year, 47% have cut back on essentials, such as groceries and utilities. In London this is 47% – the highest is Northern Ireland with 60%.
The survey shows that 25% of all adults have had to borrow money to cover their day-to-day transport costs with Londoners borrowing the most at 35%.
Andrew Sentance, PwC’s senior economic advisor, said: ‘Transport costs have been rising for a number of years. Since 2009 the transport component of the Consumer Prices Index has risen on average by 5.4% a year, and is one of the areas where prices have risen the fastest over this period. This is nearly three times the 2% inflation target and way ahead of the modest wage increases employees are seeing in their pay-packets.
‘For many people, travelling is an essential area of expenditure which is required to get to work and to maintain contact with family and friends. It is not surprising therefore, that this survey suggests that consumers have had to make cutbacks in other areas of spending to pay for higher travel costs.’