Show Hide image

The great petrol price squeeze

The urban elite don’t realise how hard rising fuel costs are hitting the country.

About a year ago I sat in a Jobcentre Plus, listening as jobseekers discussed the hurdles they faced in getting back to work. Most were construction workers. The most common problem they raised was the cost of transport to interviews. Jobcentres will help with expenses, but like all these things, the bureaucracy involved is horrendous: the men had to go to the jobcentre to fill in a form to have an interview with an
adviser, who then decided whether to fund the trip, and checked up afterwards that the interviewee had shown up. At least £50 worth of bureaucracy and probably much more, for a £20 train fare.

The men I listened to hadn't even got as far as the paperwork. Their problem was that a potential employer would ring and ask them to attend an interview the next day - but the jobcentre wouldn't see them until the following morning, so they couldn't get the travel costs paid in time. It's just a snapshot of the way in which travel costs can have much wider economic ramifications than the inability to fill the tank without thinking much about it and drive down to visit your aunt on the south coast at the weekend. (It's also a snapshot of the way in which jobcentres operate as employment centres for the middle classes to patronise working-class people with humiliating rules, but that's another column.)

Nobody's fuel

Some American research conducted a few years ago found that, after inadequate childcare, inadequate transport was the main reason for welfare recipients' failure to get back into employment. Where the cost of owning a car is too high, and where the public transport routes either do not exist or are too expensive, people can be blocked out of the labour market.

Now this problem is becoming much more widespread. I recently spoke to a friend - a professional man and car-owner, made redundant two years ago. He now runs a small business with partners based 30 miles away and ideally needs to visit it twice a week. He has had to cut that to once a week; work is scarce and he can no longer afford the petrol. He recognises that he may be losing potential contracts through not being as available as he once was to meet people and discuss ideas. But the petrol is too expensive to risk it, and he cannot move house because his son is at school locally and the housing market is too flat anyway for him to sell up without making a big loss. Trains? There aren't any. Nor any buses.

Where there are trains, for instance to London and back, they are too expensive. I spoke to someone else who had turned down an interview because the chance of getting the job didn't seem worth the gamble of the £40 peak fare. That is common round here. London is only 50 miles away, yet that employment market is closed off to many by the cost of getting there.

Research by the Joseph Rowntree Foundation into a minimum-income standard - the minimum amount a person or family needs in order to pay for basic necessities such as food, heating and shelter - has shown that the cost of fuel, both for oil-fired heating and for driving, increases the cost of living in rural areas by 10 to 20 per cent above the cost for urban families.

There are many other benefits to living in the countryside and most people I know wouldn't complain about the extra expense. What has changed recently, though, is that people now think twice before doing things they used to take for granted - driving to a bigger supermarket further away, popping to a friend's for tea, signing a child up for a club that will involve a ten-mile round trip. One friend didn't take her children swimming last weekend because the public pool was 14 miles away; another has cut out a toddler group. I don't believe for a second that either David Cameron or George Osborne has the remotest idea about this. They are too wealthy and too urban (rural constituencies for weekend breaks are irrelevant in this respect). Nor would you really expect them to care: there are bigger problems to worry about.

Stagnant life

However, these small individual and family decisions, the shortening of people's horizons, are going to impact on Tory plans where people are prevented from seeking jobs because they cannot afford to get to them - or to move house to get nearer to them, due to the stifling effect on the housing market of the uncertainty created by present Conservative economic policies. "Life stagnation," as one friend described it to me. "We literally can't afford to move, in any way at all."

That's because if you sell a house now, you lose, and owning a car has never been more expensive, with not only fuel but insurance costs skyrocketing. Car insurance premiums rose by 38 per cent in 2010 - due, say insurers, to an increase in the average cost of claims. All those expensive cars are expensive to fix when they hit a pothole (average claim for pothole damage £1,300 - what the hell for?). There are also more claims for motoring injuries than before, thanks no doubt to those ghastly lawyers. This hikes up premiums for everyone.

Private transport gets ever more expensive, while public transport is being cut as local budgets are slashed. The American study I cited above found that nine-tenths of county welfare administrators in California said that transport problems hindered the implementation of welfare reform; they couldn't get people back to work if they couldn't physically get them there. Now, a problem that used to be the subject of studies by experts in welfare dependency is spilling over into the lifestyles of the modestly paid and increasingly redundant middle classes: the squeezed middle, if you like. I wonder if the government will have the balls to tell them, à la Norman Tebbit, that all they have to do is to get on their bike - toddlers, swimming kit, heavy mortgage and all.

This article first appeared in the 14 February 2011 issue of the New Statesman, The Middle East