How local transport infrastructure influences economic inclusion

Local transport is too often a barrier to economic inclusion. Jobs on industrial estates that can’t be reached either by a bus, on foot or by bike safely. Shifts that start before the first bus leaves or finish after the last bus has left. Travel to college courses that is expensive and time consuming. People in the lowest income groups are the least likely to have a car and so must rely, at least initially, on public transport, walking and cycling to access training and job opportunities. Better local transport systems, integrated with devolved skills support, provides an opportunity for a place-based, user centred approach to support economic inclusion and deliver on two of its five key missions: growth and opportunity. 

The benefits to individuals, local communities and the wider national economy of better local transport are substantial, especially at a time of tight budgets and labour markets. The government’s own return on investment tool shows that helping someone back into work provides a £3,500 boost to their income, while the national government benefits by £11,400 and wider society £23,000.

Modelling in this report from Pragmatix, based on UK data, finds that a one per cent improvement in public transport journey times could support a 0.91 per cent reduction in employment deprivation, that is the share of people who are either looking for work or would look for work with the right support or offer. Reducing the share of households without access to a car could support a 0.77 per cent reduction in employment deprivation.

There is no ‘one size fits all’ approach to local transport as the demands for transport vary across place, just as there is no ‘one size fits all’ approach to supporting someone into work. But current funding arrangements restrict councils’ ability to tailor local transport investment and spending to local need and opportunity. Similarly, the employment and skills system are centralised and fragmented. This makes joining up policies difficult across a place. Despite this councils are working within the confines of a patchy system to bring services and strategies together to provide place-based integration of local skills interventions, spatial strategies and economic development that put the user at the centre of policy.

Local government is the only constant in an ever changing employment and skills landscape. We are the cornerstone organisation to convene local employers, transport operators and skills providers to support users Th LGA has set out its Work Local offer to improve employment and skills services locally to boost growth and widen economic inclusion across all ages. We want to see councils given equivalent control and flexibility over local transport policy for which it has similar responsibility but not the requisite powers or funding to deliver.

This report calls on the government to help councils bring down the barriers to economic inclusion by providing: 

• Devolved and flexible transport funding sufficient to deliver Local Transport Plans according to local needs.
• Devolved and flexible funding of employment and skills funding sufficient to deliver Work Local.
• Multi-year funding settlements to enable these plans to be ambitious, and councils to effectively convene local partners in other public services, business and the third sector. 
• A single settlement for councils so that complex, local challenges such as economic inclusion get the fully place-based, ambitious support required across transport, employment, and skills and beyond.

This summary report is based on research commissioned by the LGA and undertaken by Pragmatix, including new data analysis and interviews with local authorities. Sections and case studies have been rewritten and reordered for clarity and brevity. Recommendations have been updated and refreshed to reflect the election and new government priorities and conversations. 

Most journeys people make and rely on for their day-to-day lives are local. Geography, employment, income, and health all shape the local demand for these journeys, and how transport networks have developed to meet these demands and for whom.

Every part of the country has its own specific transport accessibility needs as the case studies in this report demonstrate. There are though clear patterns of accessibility as areas become more rural or more urban.

Cities are more congested and expensive for drivers, while public transport and active travel are more available, affordable, and competitive with car journey times in these areas. As cities become smaller and towns turn into countryside, public transport and active travel becomes more difficult with longer distances to cover but less frequent and more limited services, while reduced congestion and higher speed limits mean car journey times remain broadly stable even over greater distances.

A nation of drivers

As incomes rise, people purchase more vehicles (see Figure 1). Unlike public transport, cars have no timetables to follow or Sunday services, and leave directly from outside the owner’s front door while providing a comfortable, private space. 

Figure 1: The share of households that have access to a car/van in England by income decile by percentage

The expansion of car ownership over the past 70 years has reshaped where new homes, jobs, hospitals, and shopping centres are located, changing the shape of transport demand and nature of service provision. Many town centres accessible by foot, bike, bus, or tram have lost out to out of town sites where land is cheap, but cars find access and parking easier than town centres, but other modes struggle to access. Some jobs, located away from public transport services or with shift patterns that don’t match timetables are closed off to those without access to car. Those on the lowest incomes who do drive are also likelier to drive older, less efficient cars, with much higher running costs than someone with an EV charging on a domestic tariff overnight.

Economically excluded people living in rural areas without access to a car face particular challenges due the difficulty these councils face in trying to shape the transport system and fund services that provide the services these people need.

In South Staffordshire, many smaller communities are not connected to bus or rail routes, making it difficult for residents to access education, employment, and training. The sparse population and lack of footpaths further exacerbate the issue. As a result, almost 90 per cent of households in the area use private vehicles, with over half having access to more than one vehicle. This reliance on private vehicles, especially in less affluent areas, leads to higher emissions. Those in the area without access to cars are at a significant disadvantage, particularly young people who cannot yet afford to drive caught in a cycle of ‘no car to get to work, no work to get a car’ (Figure 2). To address this, efforts to achieve Net Zero in areas like South Staffordshire will need to focus on changing transport behaviours, providing incentives for greener, cheaper-to-run cars and vans for low earners with high mileage, and developing innovative public transport solutions for areas with lower demand and longer distances.

In Northumberland, the number of workers in sectors with different shift patterns and the mismatch between public transport schedules and the needs of workers is a major concern. While Newcastle airport is a major employer in the region, many residents find it difficult to reach, especially outside normal working hours. Community transport initiatives in rural Northumberland are reported to be good, but the frequency and scale of the services are not sufficient to help with access to employment opportunities. Stakeholders in Northumberland would like to see greater devolved funding arrangements and powers for transport, as well as more investment in transport networks within the authority area. 

Figure 2: The ‘no car to get to work, no work to get a car’ cycle

Public transport challenges

Even where public transport is effective and available. Other barriers affect young people, those on low incomes and shift workers:

In Nottingham seven per cent of 16 to 17-year-olds are not in education, employment, or training (NEET). While the city enjoys frequent and efficient transport links serviced by both buses and trams, the persistent challenge of expensive transport, especially for the most disadvantaged is a concern. This issue is particularly acute for students who often struggle with tighter budgets while pursuing their education. Although radial routes into and out of the centre are well established in Nottingham, orbital routes are notably lacking, forcing residents to navigate circuitous journeys to reach neighbouring areas. This spatial disconnect leads to a reluctance among individuals to undertake costly and long-distance commutes to education, employment, and training (EET) opportunities, even within a city with relatively efficient transport links.

In the London Borough of Lambeth, which is served by good bus, underground, and rail links, day-to-day difficulties reaching work were not identified as a common challenge. The research highlighted other issues for residents, including concerns about safety and affordability. Shift workers, especially those traveling at night and in the early morning, face challenges with safety, such as poor street lighting on walking routes to and from stations and bus stops. People also find it difficult to reach jobs further away or outside the borough as orbital links tended to be less efficient than radial links. Young people are the most affected by these transport issues, hindering their access to EET opportunities. Safety concerns, including gang related activity, make some young people uncomfortable moving within the borough. The affordability of transport is also a major concern for many people.

Transport impacts on an individual’s quality of life as an enabler of economic and social inclusion. Better transport makes access to healthcare, jobs, education and training, and community possible. Where inadequate transport is a barrier to work, the cost to individuals, communities and national government is significant. For national government, the financial benefits of higher tax revenues and lower public spending are £11,400 (see Figure 3).

Figure 3: Financial benefits to various ‘stakeholders’ of an individual returning to work in England

Local transport and economic deprivation 

It is difficult to make a clear link between economic deprivation and public transport accessibility across England. When dividing area by type, from the most built up to most rural, Pragmatix analysis the link was clear at either end of the built-up rural spectrum. This may be because many big cities have deprived areas close to city centres with good transport links to jobs but different barriers to economic inclusion, while in rural areas car ownership is high even among poorer households due to the challenges of living without a car.

There is a clearer link between public transport accessibility and economic deprivation in smaller cities and towns with rural areas. The longer commutes by public transport get, the worse economic deprivation becomes. Poor public transport or car accessibility may be a particular barrier to economic inclusion in these areas more than elsewhere. 

Pragmatix modelling indicates that, in England, a one per cent decrease in travel time to the nearest medium employment centre results in a 0.91 per cent decrease in employment deprivation, while a decrease in the proportion of households without access to a car or van is associated with a 0.77 per cent reduction in employment deprivation.

Local transport and health

Poor health forces people out of work and stops them getting back into the workplace. Transport can be one barrier stopping them getting the help they need, whether a long commute leaves them less time to get to the GP, or the journey to the GP is a barrier. In the most built-up areas, there is little accessibility penalty to using public transport to reach a GP, whereas in rural areas there is a significant journey time penalty (Figure 4).

Figure 4: Time taken to travel to the nearest GP in England by area and transport type

East Lindsey is an attractive holiday destination with seasonal tourism employment and few all-year-round opportunities. The impact of poor health on the working age population is a key concern. The significant health issues experienced on the coast means many people are economically inactive – 30 per cent in East Lindsey compared to the national average of 26 per cent. A lack of transport options means residents are not readily able to access healthcare and therefore become economically inactive due to ill health for longer periods. To boost economic growth, it's important to support those who are long term economically inactive due to poor health or an inability to access work. Adaptive services that meet the needs of likely users are key for East Lindsey due to its sparse population and location.

Increasing car access and public and active travel accessibility will reduce deprivation by helping people get the skills, healthcare they need to access jobs reliably and affordably.

Young people, and especially care leavers, face many barriers to economic inclusion. The cost of transport, public and private, can be a major barrier. A young person getting driving lessons can expect to spend nearly £1,500 ahead of a test, another £1,500 insurance in their first year once passed, and nearly £3,000 on a first car.

Funding is available to help young people to overcome any specific financial barriers to participation, for example, the 16 to 19 Bursary. DfE makes discretionary bursary allocations to institutions that have a 16 to 19 contract or funding agreement each year. Institutions then make awards based upon students' financial needs to participate. Councils are not involved in the allocation of bursaries except when administering the fund in respect of their own direct provision, including local authority-maintained schools with sixth forms.

Councils have a specific responsibility to increase participation rates and ‘ensure that young people are not prevented from participating because of the cost or availability of transport to their education or training’. The current set up of powers, funding and coordination make this difficult for councils to deliver.

Young people away from the largest cities face the most significant barriers to getting to college and having choices about which college to attend if they do not have access to a car (Figure 5). Councils in these areas struggle to meet their duties as set out above. 

Figure 5: Number of further education colleges available in England by area by transport time

Some areas have tried to help support young people into work or to college or training by providing scooters or e-bikes. ‘Wheels2Work’ is a charity that aims to prevent or relieve unemployment and to promote social inclusion and mobility. These schemes offer affordable scooter hire for £25 to £35 a week to people struggling to get to training or work. 

How local government transport policies increase economic inclusion:

• Cars: Councils are supporting care leavers with funding for provisional licences and driving lessons, recognising the importance of a car for many jobs and the high cost of driving lessons. 
• EVs: EVs have a high up-front cost but lower running costs, offering the potential for significant savings for low-income drivers who switch from an inefficient and polluting petrol or diesel vehicle to an EV. In France, a ‘social leasing’ scheme to provide EVs to the lowest-income households has been extremely popular, with the scheme oversubscribed and capped at 50,000 vehicles in the first year.
• Public transport: Local and Combined Authorities across the country are providing half-price fares for 16 to 18-year-olds and have introduced fares for apprentices aged 19 to 24-year-olds.
• In Greater Manchester, the newly franchised network has begun night bus services to increase the accessibility of hospitality venues, hospitals, and distribution centres through the night. These services will have additional support staff to improve safety. New bus franchising powers across all areas offer the chance for all councils to have a greater influence in shaping the bus network, fares and frequencies to support economic inclusion.
• Bicycles and e-bikes: Bikes and increasingly e-bikes are much cheaper than a car, without the licensing, insurance or fuel costs. For hillier and longer journeys up to 10 to 15 miles, e-bikes provide a significant benefit over the pedal version and comparable speeds to a car. Uttlesford District Council lets residents rent a pedal or e-bike for up to six months at subsidised rates.
• E-scooters: Many local authorities have launched e-scooter trials, and companies such as Voi provide 50 per cent discounts for low-income users. (The LGA published a report into shared micromobility models to help councils considering the potential e-bikes, e-scooters and e-cargo bike schemes).

What can central government do to help councils support residents to access employment and skills opportunities

Devolved and flexible local transport funding

Sufficient funding for councils to invest in transport locally to respond to local circumstances and opportunity rather than reflect central government funding pots. Local councils should be able to decide exactly what balance of investment they know their area needs and can deliver. Decisions about investment in more affordable bus fares for young people, better services, junction improvements to improve traffic flow, or new public EV charge points should be made by councils, not set by ringfenced funding pots. Councils have the knowledge about their local areas to help central government departments deliver far more on our shared outcomes and national missions. The City Region Sustainable Transport Scheme provides Metro Mayors with single-pot transport funding that all areas would benefit from. 

Devolved flexible employment and skills funding to deliver Work Local

The LGA’s Work Local model is a ready-made blueprint for empowering local government to create a joined-up offer of integrated employment and skills services for young people and adults through three interlinked offers: 

• Youth Pathways to help young people aged 16 to 24 ‘not in employment, education or training’, or at risk of NEET, find their first job or put them on a career path. 
• Working Futures for adults who are disadvantaged in the labour market, and who need personal support to find work or better work.
• Skills for All to provide a better match of skills supply and demand, a skills and learning offer linked to local careers advice and jobs, and promote lifelong learning.  

Multi-year funding certainty

Long-term funding certainty from the government would improve economic inclusion. It would facilitate strategic decision making and allow councils to undertake ambitious, long-term projects while maintaining and upgrading existing links and attracting private sector partnerships. Competitive bidding such as for recent Bus Service Improvement Plans consumes time and resources for councils but still left many areas without any funding at the end. Councils would be able to deliver more and greater value for money with the multi-year funding certainty granted to Metro Mayors and national transport bodies such as Network Rail and Highways England.

Single settlements

Single settlements (including transport, skills, and employment support) should be offered to all areas as part of deeper devolution. This will bring devolution and funding in line so that it is fit for purpose to improve integration of services and outcomes that focus on a user’s full needs and unlock the wider potential of place-based thinking and intervention. The government has committed to departmental budgets for Trailblazer Mayoral Combined Authorities, allowing reallocation of up to ten per cent across policy areas. The flexibility of a single settlement for all areas would allow councils to integrate Local Transport Plans and Work Local strategies to support more people into work.