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Household Satellite Accounts - Valuing household transport in the UK, 2010

Released: 04 July 2014 Download PDF

Abstract

Experimental estimates show the value of households’ transport services was £269 billion in 2010, equivalent to 18.1% of GDP. Households’ transport services relate to the journeys provided by households using private modes of transport such as cars, motorcycles, cycles and walking. This paper outlines the methodology for the valuation of transport services provided by households building on an experimental methodology first published by ONS in 2002.

Key points

  • Transport services of households are the provision of transport by households using private transport modes such as cars, motorcycles, cycles and walking.

  • For 2010 the value of household transport services was estimated to be £269 billion, equivalent to 18.1% of GDP.

  • Between 1995/1997 – 2010 the value of UK transport services of households doubled.

  • In 2010 the value of household production of transport services was approximately eight times bigger than total household final consumption expenditure on transport services.

 

Introduction to the Household Satellite Account (HHSA)

The Household Satellite Account (HHSA) accounts for the non-market production of households. This is all the unpaid production of goods and services provided by households in the UK. Due to the unpaid nature of this production, conventional National Accounts measures such as GDP, do not fully take into account the production of these goods and services. Nonetheless, if these goods and services were paid for, they would contribute to GDP. For example, if the household members cleaned their house themselves, this service would be unpaid and therefore excluded from GDP. However if the household members paid somebody else to clean their house, this service would be included in GDP as it involves a market transaction.

The HHSA provides a means by which the influence of changing patterns of unpaid work on the economy can be measured. The information will also be of use to policy makers who need to take significant amounts of unpaid work into account.

In 2002 the Office for National Statistics (ONS) published the first HHSA for the UK, which measured and valued the unpaid goods and services produced by households (ONS, 2002; Holloway, Short & Tamplin, 2002).

Following the publication of the Report by the Commission for the Measurement of Economic Performance and Social Progress (2009), there has been fresh interest in valuing household production. Therefore, as part of the Measuring National Well-being programme, ONS is currently updating the HHSA.

This work falls outside the scope of the UK National Accounts. This is because the inclusion of all activity which is productive (in the economic sense) but which does not have a monetary value would swamp the monetary flows, obscure what is happening in the markets, and reduce the usefulness of National Accounts data for analysis. The HHSA is therefore separate from, but conceptually consistent with, the UK National Accounts.

The HHSA extends the National Accounts boundary to include all activity produced by households that could be delegated to another person. This activity is divided into several principal functions; providing housing, transport, nutrition, clothing and laundry services, adult care, child care and voluntary work. The approach being taken by ONS is to focus on the outputs of these principal functions.

The methodology remains under development and any estimates reported here, or in forthcoming publications, should be considered experimental and interpreted with caution. ONS welcomes comments and feedback on all aspects of the methodology used and the assumptions made, and seeks suggestions for further/alternative data sources. A more detailed description of the methodology can be found in the annexes of this article.

What are transport services of households?

Transport services of households are the provision of transport by households using private transport modes such as cars, motorcycles, cycles and walking. Transport for all purposes is included, except cases where the use of the transport is purely for pleasure (i.e. going for a walk, driving for pleasure).

The reason for excluding the use of transport modes for pleasure is that this purpose can be categorised as a non-productive activity as it cannot be delegated to someone else. In the case of using transport purely for pleasure, it is not possible for someone else to provide this as the outcome is not the “change of location” but the pleasure of the journey, for example going for a walk.

Overview of the methodology

A detailed explanation of the methodology can be found in Annex 1, this section provides a brief overview.

The output of the transport services of households is defined as the total number of miles travelled in all trips, known as the total trip miles, using private modes of transport. This is different from both the number of trips (which does not take into account the distance travelled) and the total miles travelled by the population (which does not take into account that individuals may not travel alone all the time).

The National Travel Survey provides us with data on the distance travelled by individuals and the average number of people travelling together. Estimates of the total number of miles travelled in all trips can be calculated by dividing the total number of miles travelled by the population by the average number of people per journey. 

Estimates of the value of transport services are calculated by multiplying the number of miles for all trips by the price an individual would have paid if they had bought this service from the market. In this case, the price used is that of a Private Hire Vehicle (PHV). This has been identified as the nearest market equivalent as it provides transport from the original location to the final destination (i.e. a ‘door-to-door’ service).

A PHV is different to a taxi as it is not possible to hail for a PHV in the street, but it will collect the passenger at any point agreed, without any need for them to travel to a particular rank or street. If we used other modes of transport provided by the market such as buses or trains, a trip to the train station or bus stop will also be required. Data on the price of PHVs also come from the National Travel Survey.

The data on the total number of miles for all trips can be split into long trips (2 miles and over) and short trips (under 2 miles), allowing for different prices to be used. If the service was purchased in the market, PHVs would apply a cheaper price per mile in a long trip than in a short one. Data are also estimated separately for London and the rest of the United Kingdom, reflecting the higher prices charged in London.

Total trip miles

The total trip miles represent the output of transport services of households as it shows the total number of miles undertaken in all the trips that households produce.

Figure 1: Total trip miles, 1995/1997 - 2010

United Kingdom

Figure 1: Total trip miles, 1995/1997 - 2010
Source: Office for National Statistics

Notes:

  1. From 1995 to 2001, figures are calculated from data obtained from the National Travel Survey (NTS) only. For 2002 to 2010, data was obtained from both the NTS and the Travel Survey for Northern Ireland (TSNI).
  2. For years prior to 2002, the estimates are calculated from 3 years average data due to sample sizes. In 2002, the NTS sample size was trebled.

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UK total trip miles experienced a sharp increase between 1995/1997 and 1996/1998 before growing steadily to 2006, when they peaked at 178 billion miles. Following this, UK total trip miles declined to 168.5 billion miles in 2009 before recovering to 170.8 billion miles in 2010.

The increase in the total trip miles travelled in private transport from 1996/1998 to 2006 was driven by both the increase in total miles travelled in private transport by the population and by the moderate reduction in the average number of people travelling together.

During the period 1996/98 to 2006, although there was a slight decline in miles travelled per person per year in private transport this was largely offset by the continuous increase of the UK population, resulting in a rise in the total miles travelled by the total population. At the same time the average number of people travelling together as a group declined slightly. Together, these resulted in an increase in total trip miles.

This shift to more individual journeys happened at the same time as the percentage of households without access to a car in Great Britain fell from 30% in 1995/97 to 25% in 20051. In addition, both the proportion of households with more than 1 car and the percentage of women and older people with driving licenses increased2. There could also have been an impact on the total number of miles travelled from petrol prices, which remained relatively flat between 2000 and 20053 as government duties were frozen.

Figure 2: Petrol prices and average duties on petrol and diesel, 2001 - 2010

United Kingdom

Figure 2: Petrol prices and average duties on petrol and diesel, 2001 - 2010
Source: Office for National Statistics, Energy and Climate Change

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Following the steady increase in total trip miles to 2006, there was a sharp decrease between 2006 and 2009, a number of factors could have influenced the total number of trip miles during this period. Firstly, the behaviour of fuel prices over this period and secondly, the onset of a recession in mid 2008.

Trips by car account for the majority of all trips travelled. In 2010, trips by car accounted for 64% of all trips travelled and 78% of the distance travelled4. Increases in fuel prices could impact the total trip miles travelled by car as individuals might consider cheaper alternatives or make fewer journeys where possible. Both petrol and diesel prices increased temporarily in 2005 and 2006. Then, petrol and diesel prices increased by 36% and 42% respectively within the 18 months from 2007 to mid 2008.

Figure 3: Petrol and diesel price per litre, 2003 – 2010

United Kingdom

Figure 3: Petrol and diesel price per litre, 2003 – 2010
Source: Energy and Climate Change

Notes:

  1. Figures in current prices.

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The onset of the 2008 recession saw an increase in unemployment and a reduction in the income of some households.

An increase in unemployment could result in a fall in UK total trip miles as the number of employees commuting to work falls. For the period 2007 to 2009 UK unemployment rate for those aged 16 and over rose from 5.3% to 7.8%5 while the number of commuting trips and business trips per person per year decreased by 7% and 15% respectively for Great Britain from 2007 to 20106.

Additionally, faced with a fall in household income, some individuals might reconsider their options for travelling, searching for cheaper alternatives (for example switching to cheaper modes) or reducing the number of trips they make where possible. A fall in household income could therefore be associated with a fall in households’ total trip miles. For the period 2007/2008 to 2008/2009 real median household equivalised disposable income7 fell from £24,121 to £23,8168. In contrast to the decline of UK total trip miles travelled in private transport, for 2007-2010 the total trips per person per year for Great Britain grew by 23% for London buses and 9% for surface rail9.

Notes for Total trip miles

  1. Transport Statistics Bulletin 2008 – National Travel Survey.

  2. Transport Statistics Bulletin 2008 – National Travel Survey.

  3. The Effect of Duties on Petrol and Diesel on Household Disposable Income, 2011 – Office for National Statistics.

  4. 2010 Statistical Release – National Travel Survey.

  5. Labour Force Survey – Office for National Statistics.

  6. 2012 release, table NTS0403 – National Travel Survey.

  7. Median household equivalised disposable income is defined as the amount of money that households have available after deducting direct taxes and including cash benefits provided by the state. Equivalised means that it also takes into account the number of members of the household and their ages, acknowledging that larger households will need higher incomes to achieve the same standard of living as households with fewer members. Deflated using the implied deflator for the household sector.

  8. Middle Income Households, 1977-2011/12 – Office for National Statistics.

  9. 2012 release, table NTS0303 – National Travel Survey.

Price of transport services in the market

As outlined in the methodology overview section, the National Travel Survey data allow for the calculation of the price per mile of a Private Hire Vehicle (PHV). Prices can be split into long and short trips for both London and for the rest of Great Britain. Prices for the rest of Great Britain are also used for Northern Ireland as PHV price data are not available for this region.

Figure 4: Private Hire Vehicle price per mile for short and long trips for London and for the rest of Great Britain, 1995/1997 - 2010

United Kingdom

Figure 4: Private Hire Vehicle price per mile for short and long trips for London and for the rest of Great Britain, 1995/1997 - 2010
Source: Transport

Notes:

  1. Figures in current prices.

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From 1995/1997 to 2000/2002 prices per mile of a PHV all increased gradually. Prices per mile of a PHV were all higher in 2010 compared to 2002. However, the price per mile of a PHV for the rest of Great Britain was less volatile than for London, where the price per mile of a PHV for short trips experienced a large spike in price in 2007 and 2008.

The spike in price per mile experienced in London in 2007 and 2008 could reflect the sharp increase in the price of petrol and diesel during 2007 and mid 2008. In July 2008 petrol prices peaked at 119.4 pence per litre while diesel prices peaked at 132.9 pence per litre.

Value of total trip miles

The transport services of households are valued by multiplying the total trip miles for long and short trips for London and for the rest of the UK by their respective price per mile of a Private Hire Vehicle (PHV).

Figure 5: Value of transport services of households, 1995/1997 – 2010

United Kingdom

Figure 5: Value of transport services of households, 1995/1997 – 2010
Source: Office for National Statistics

Notes:

  1. Gross Domestic Product (GDP) – Current prices, seasonally adjusted.
  2. The value of transport services is expressed in current prices.
  3. In Northern Ireland, short journeys are defined as journeys of 2 miles or under and long journeys are defined as journeys over 2 miles.

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The value of the household production of transport services increased between 1995/1997 and 2010. It generally grew steadily until 2006, before increasing significantly in 2007 and spiking to £286 billion in 2008. In 2009 the value experienced a small decline before recovering slightly in 2010. The value of the production of transport services of households was £269 billion for 2010, equivalent to 18.1% of GDP1.

Changes in the value of the production of transport services of households are mainly driven by changes in the price per mile of a PHV rather than by changes in the total trip miles. For example, the 10% decline in the value of transport between 2005 and 2006 took place at the same time as the volume figure of total trip miles increased. However, in 2006 all the prices per mile of a PHV decreased except for short trips in London. The opposite can be seen in 2007 and 2008, when the value of the transport estimate increased sharply as a result of sharp increases in all the prices per mile of a PHV. This increase in prices in 2007 and 2008 outweighed the decline in total trip miles.

As it can be seen in Figure 6, from 1995/1997 to 2006 the value of transport services in London followed a similar growth pattern to that of the rest of the UK. In 2007 the value of transport services of households experienced a strong increase of 69% and 45% in London and in the rest of the UK respectively.

Figure 6: Value of transport services of households for London and the rest of the UK, 1995/1997 – 2010

United Kingdom

Figure 6: Value of transport services of households for London and the rest of the UK, 1995/1997 – 2010
Source: Office for National Statistics

Notes:

  1. Figures in current prices.

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Notes for Value of total trip miles

  1.  Gross Domestic Product – Seasonally adjusted, current prices.

Comparison with household expenditure on transport services

As highlighted in the introduction, the HHSA allows a comparison of the household production of activities and similar activities provided by the market. This section therefore considers household production of transport services with household expenditure on market produced transport services.

The shape of the value of the household production of transport services for the period 1996/1998 to 2010 is similar to the shape of the household expenditure on market produced transport services. They both grew steadily until 2007, although the market expenditure on transport followed a smoother increase than the household production. After 2008, they both dropped slightly in 2009 and recovered in 2010.

The fall in household expenditure on all transport services following the onset of the 2008 recession is also seen on the household expenditure on air, road and other transport services. However, during the same period, household expenditure on water transport services increased and expenditure on rail transport stayed the same, before increasing steadily.

Figure 7: Household expenditure on market produced transport services, 1997 - 2013

United Kingdom

Figure 7: Household expenditure on market produced transport services, 1997 - 2013
Source: Office for National Statistics

Notes:

  1. Current prices, seasonally adjusted.
  2. Components may not sum to total due to rounding.

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In 2010 the value of total market expenditure on transport services was valued at £33.4 billion, while the value of household produced transport services was £269 billion. Total market expenditure on transport services was equivalent to 12.4% of the value of household production of transport services. This was similar in 1997, when total market expenditure on transport services was equivalent to 12.3% of the value of household production of transport services. However, Figure 8 shows that in the years between, total market expenditure on transport services rose to the equivalent of 17.1% of the value of household production of transport services in 2006 before falling back.

Figure 8: Household expenditure on total market transport services as a proportion of transport services of households, 1997 – 2010

United Kingdom

Figure 8: Household expenditure on total market transport services as a proportion of transport services of households, 1997 – 2010
Source: Office for National Statistics, Transport

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Annex 1: Methodology

Transport services of households are the provision of transport by households using private transport modes such as cars, motorcycles, cycles and walking. All household uses of private modes of transport are included except transport purely for pleasure (i.e. going for a walk, driving for pleasure). This is because only productive services are valued in the Household Satellite Account.

Productive activity is defined as all activity which could be provided by a third party – known as the third party criterion1. In the case of using transport purely for pleasure, it is not possible for a third party (the market) to provide this. Therefore it is considered a non-productive activity and excluded from the valuation.

Transport purely for pleasure (i.e. going for a walk) differs from transport for the purposes of leisure (i.e. driving to the cinema). Regarding the latter, despite the purpose of the trip being leisure, the trip itself could be delegated to a third party. Hence, the trip meets the third party criterion and is considered productive and included in the estimates.

The output of the transport services of households is defined as the total number of miles travelled in all trips, known as the total trip miles. This is different from both the number of trips (which does not take into account the distance travelled) and the total miles travelled by the population (which does not take into account that individuals may not travel alone all the time).

Data on the average miles per person per year (MPPPY) for London and for the rest of Great Britain are taken from the National Travel Survey. For the period 1999/2001 to 2009/11 only, volume data for Northern Ireland were available from the Travel Survey for Northern Ireland. Journeys are classified as being either within London or the rest of Great Britain. Also, they are split into long (2 miles and over) and short (under 2 miles) journeys.

The average MPPPY are then grossed up to the UK population using the individual weights provided by the National Travel Survey and the Travel Survey for Northern Ireland. This provides the total miles travelled in a year by the UK population.

Dividing the total population miles by the average number of people travelling together as a group adjusts for group travel and provides the miles travelled in all the trips undertaken – the total trip miles. We account for group travel in our estimate as we are interested in valuing the production of journeys, rather than the distance each individual travels.

The final value of transport services is obtained by multiplying the total trip miles by the price an individual would have paid if they had bought this service from the market. In this article, the price of the nearest market equivalent has been considered to be the price per mile of a PHV. This mode of transport is similar to the household transport services in the sense that provides a ‘door-to-door’ service. Alternative modes of transport such as taxis, trains and buses would require additional journeys to and from a taxi rank, train station or bus stop respectively. Data on the price of PHVs come entirely from the National Travel Survey.

Equation 1: Calculation of the value of transport services of households.

Equation 1: Calculation of the value of transport services of households.

The value of transport services is calculated by multiplying the miles per person per year by the population and dividing by the average number of people in party. This is then multiplied by the price per mile of a private hire vehicle. The value is calculated separately for short and long trips in London and for short and long trips in the rest of the UK. The results are added up to obtain the total value of transport services for all the regions.

Notes:

  1. Where r represents the regions of London and rest of the UK.

The transport services of households are estimated separately for long and short trips to account for the differences in the PHV cost per mile. An analysis of the price per mile of a PHV for Great Britain for the period 2002 to 2010 shows that for short trips (less than 2 miles) the cost per mile is significantly higher than the cost per mile of long trips (2 miles and over). Using the total average cost per mile would result in an over estimation of the value of long trips and an under estimation of the value of short trips.

Figure 9: Private Hire Vehicle price per mile, 2002-2010

Great Britain

Figure 9: Private Hire Vehicle price per mile, 2002-2010
Source: Transport

Notes:

  1. Each dot corresponds to one observation of the price per mile of a private hire vehicle for the period 2002 to 2010.

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Further analysis of the PHV cost per mile for Great Britain shows little variation between regions. Only London appears to have a price significantly different than that of the rest of the regions in Great Britain. Furthermore, the sample size for PHV cost per mile is too small to produce estimates on a regional level.

Notes for Annex 1: Methodology

  1. Beyond The Market,  pg. 64 -  National Research Council of the National Academies.

Annex 2: Data Sources

The National Travel Survey from the Department for Transport and the Travel Survey for Northern Ireland from the Department for Regional Development in Northern Ireland provide all the necessary data on the average number of miles travelled per person, PHV price and average number of people travelling together as a group. The Office for National Statistics provides midyear population estimates for London, Northern Ireland and the rest of Great Britain.

The National Travel Survey (NTS) was first commissioned in 1965/1966, and it was repeated on an ad-hoc basis until 1988, when it became a continuous survey (i.e. fieldwork was conducted on a monthly basis). The annual sample size was first set at 5,040 addresses, but trebled to 15,048 addresses in 20021. To ensure the sample is representative of the population, postcodes are stratified by region, car ownership and population density. Then, random addresses are selected within each postcode sector or stratum. For practical reasons, the Scottish Islands and the Isles of Scilly are excluded from the sampling frame.

The Travel Survey for Northern Ireland (TSNI) is based on the National Travel Survey. It began in Northern Ireland as a continuous survey in 1999. The first results were published in 2003 for the period 1999-20012. The sample size is smaller than the National Travel Survey and varies between 856 and 1,037 households interviewed per year. For this reason, 3 years of data are combined to ensure robust analysis. Household addresses are chosen using a systematic random selection from the Land & Property Services (LPS) list. LPS is a list of private addresses available to the Northern Ireland Statistics and Research Agency. People living in institutions (though not in private households in such institutions) are excluded. A representative sample of 145 addresses is selected for interview each month.

Data for PHV price per mile and the average number of people travelling together as a group was only available from the National Travel Survey. For this reason we have used the NTS prices for Great Britain excluding London to value transport in Northern Ireland.

Volume data from road traffic statistics from the Department for Transport was considered to provide alternative estimates of the total number of miles travelled. These estimates are based on traffic data collected continuously from a national network of around 180 Automatic Traffic Counters3. Eventually, these estimates were not considered appropriate for the Household Satellite Account as they could include miles covered by foreign and commercial vehicles and they make no distinction for the purpose of the trip.

Notes for Annex 2: Data Sources

  1. National Travel Survey 2012 Technical Report - NatCen for The Department of Transport.

  2. Travel Survey for Northern Ireland in depth report 2010 – 2012 – Department for Regional Development.

  3. Technical Information 2013 – Department for Transport.

Annex 3: Sensitivity Analysis

The estimates of the value of the transport services of households are subject to a number of assumptions. This section considers some alternative assumptions to those made and the resulting effect they have on the value of the transport services of households.

    1.  Using data from the Consumer Prices Index (CPI)

Data collected for the Consumer Prices Index provides information on the price per mile of a two mile journey in a PHV for the whole of the UK. The main limitation of these data is that only 2 miles journeys are considered. The National Travel Survey provides us with evidence that the cost of a PHV varies by the length of a trip. Therefore, the cost of a PHV from the National Travel Survey, which can be broken down by the length of the trip, was considered a more appropriate source for the purpose of this publication.

Figure 10: Value of transport services of households, 1995/97 – 2010.

United Kingdom

Figure 10: Value of transport services of households, 1995/97 – 2010.
Source: Office for National Statistics

Notes:

  1. Figures in current prices.

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In comparison to the estimates calculated using the PHV price per mile from the National Travel Survey (NTS), the use of CPI prices produces a higher and steadier estimate. In 2010, the value of transport services produced by households was £ 149.3 billion higher using the CPI price than the value estimated using the NTS price.

    2.  Using AMAP to value walking and cycling

The market equivalent of a PHV for private modes of transport matches well with trips that are undertaken using cars. However it can be argued that a PHV is not a good market equivalent for walking and cycling as the cost per mile of walking and cycling is clearly lower than that of driving.

Indentifying a market equivalent for walking and cycling proves challenging due to the characteristics of the transport mode. However an indication on the cost per mile of cycling and walking can be found using the Approved Mileage Allowance Payments (AMAP) guideline provided by HM Revenue & Customs (HMRC). The Approved Mileage Allowance Payments is a tax-free payment for drivers who make business trips using their own vehicle. HMRC advises a payment of 20 pence per mile for cycling, which is intended to cover the costs of the cyclist’s expenses. As there are no AMAP for walking, it has been assumed to be the same as the cost per mile of cycling.

The main limitation of the AMAP as a market equivalent is that these rates only account for intermediate consumption and depreciation. They do not account for any labour cost, unlike the NTS PHV cost per mile, which accounts for the labour cost of the PHV driver.

In comparison to the estimates calculated using the National Travel Survey (NTS) price per mile of a PHV for all modes of transport, using the AMAP cycling rate for miles undertaken walking and cycling produces a lower estimate that follows a similar growth pattern.

Figure 11: Value of transport services of households, 1995/1997 – 2010.

United Kingdom

Figure 11: Value of transport services of households, 1995/1997 – 2010.
Source: Office for National Statistics

Notes:

  1. Figures in current prices.

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    3.  Not adjusting for length of trip

The final estimate is calculated by estimating the value separately for long trips and for short trips. The reason is that the analysis of the PHV cost per mile shows that for short trips the cost per mile is significantly higher than the cost per mile of long trips.

Without adjusting for the length of trip, the average price per mile of a PHV is skewed upwards due to the significantly higher price for short trips. Consequently, the estimate is significantly higher for all years although it follows a similar growth pattern.

Figure 12: Value of transport services of households, 1995/1997 – 2010.

United Kingdom

Figure 12: Value of transport services of households, 1995/1997 – 2010.
Source: Office for National Statistics

Notes:

  1. Figures in current prices.

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    4. Accounting for waiting time

The 2002 methodology also accounted for PHV ‘waiting time’. This is the percentage of the cost of a PHV that accounts for the time that a PHV will be waiting for a fare. The 2002 methodology assumed that the PHV waiting time was 5% of the total fare and deducted this value off the estimates. In this publication no adjustment for PHV waiting time has been applied as the percentage of the cost of a PHV that accounts for waiting time is unknown.

However, if a 5% price reduction for waiting time is assumed, the final value as a % of GDP falls by slightly less than 1% (being 0.68% the smallest drop in 2006 and 0.98% the highest in 2008). Each subsequent 5% deduction in the price results in final estimates falling further by less than 1%.

Figure 13: Value of transport services of households in the UK as a % of GDP assuming a reduction in price for ‘waiting time’, 1995/1997 – 2010.

United Kingdom

Figure 13: Value of transport services of households in the UK as a % of GDP assuming a reduction in price for ‘waiting time’, 1995/1997 – 2010.
Source: Office for National Statistics

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    5. Estimates comparison

Figure 14 compares all of the estimates considered.

Figure 14: Value of transport services of households, 1995/1997 – 2010.

United Kingdom

Figure 14: Value of transport services of households, 1995/1997 – 2010.
Source: Office for National Statistics

Notes:

  1. Figures in current prices

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The use of CPI prices per mile of a PHV leads to the highest estimate of the value of transport services provided by households.  The second higher estimate is obtained by using NTS prices per mile of a PHV, but without differentiating between short and long trips.

Both the estimate using AMAP rates for cycling and walking and the estimate using NTS prices only but accounting for a 5% ‘waiting time’ are slightly lower than the selected final estimate.

The estimate using the PHV price per mile obtained from the NTS and differentiating between short and long trips in London and in the rest of the UK is considered to be more accurate. It does not account for ‘waiting time’ price adjustment.

Annex 4: Revisions

In 2002 the Office for National Statistics published an experimental methodology to value the transport services of households for the years 1993-2000. The 2014 methodology revises the estimates for the period 1995/1997 – 1998/2000 and extends the period to 2010. As shown in Figure 14 below, the 2014 estimates are slightly higher for the period 1995/1997 – 1997/1999 and lower in 1998/2000. These discrepancies are due to small differences between both methodologies. 

First, the 2002 methodology only considered observations for the calculation of the price per mile of a PHV were the respondent reported travelling on their own. The reasoning for this was to avoid misreporting of the price per mile when respondents travelled in groups. In the 2014 methodology, outliers are first removed and then the price per mile of a PHV is calculated from all the remaining observations.

Second, the 2002 methodology calculated the yearly price per mile of a PHV for 1995/1997 – 1998/2000 by applying the year-on-year changes in the retail price index (RPI) of taxis to the average price for the whole period. The 2014 methodology calculates the price per mile of a PHV for each year in the period as the 3 year average of the observations centred in the year of interest. These two first points result into a slightly higher price per mile of a PHV for the period using the 2014 methodology than by using the 2002 approach.

Additionally, the 2014 methodology estimates the value of transport services of households separately for long and short trips to account for the differences in the PHV cost per mile. The 2002 methodology estimated the value of transport services of households without making this adjustment.

Finally, although both methodologies account for group travel, the 2002 methodology considered the average number of people travelling together as a group by each purpose of travel. On the contrary, the 2014 methodology does not differentiate for different purposes of travel when calculating the average number of people travelling together as a group. It results on total trip miles being slightly lower for Great Britain in comparison to the 2002 methodology.                                

In conclusion, the fact that the 2014 methodology uses current 3-year -average prices to value transport services leads to a more volatile final estimate than the 2002 methodology. By using the 2014 methodology, for the period 1995/1997 – 1998/2000, the higher price per mile of a PHV for Great Britain excluding London offsets the slightly lower volume figure. However, for the years 1999/2001, the higher price per mile of a PHV is not sufficient to offset the lower volume figure and the final estimate is lower in the 2014 methodology than in the 2002 methodology.

Figure 15: Value of transport services of households, 1993 – 2010.

United Kingdom

Figure 15: Value of transport services of households, 1993 – 2010.
Source: Office for National Statistics

Notes:

  1. Figures in current prices.

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Background notes

  1. Details of the policy governing the release of new data are available by visiting www.statisticsauthority.gov.uk/assessment/code-of-practice/index.html or from the Media Relations Office email: media.relations@ons.gsi.gov.uk

Supporting information

Further information

Household Satellite Account (HHSA) (experimental) - The Household Satellite Account (HHSA) measures and values unpaid household labour, household production and household output in the UK, such as cooking, cleaning, DIY and childcare
United Kingdom National Accounts - The Blue Book is a key annual publication of National Accounts statistics and the essential data source for anyone concerned with macro-economic policies and studies.
The Effect of Duties on Petrol and Diesel on Household Disposable Income - The effect of duties on petrol and diesel on higher and lower income households.
Labour Market Statistics - Employment, unemployment, economic inactivity, claimant count, average earnings, labour productivity, vacancies and labour disputes statistics.
Middle Income Households - This article analyses the median income of UK households, and the composition of the income received and the taxes paid by middle income households.

Related Internet links

References

  1. Marks C (2013). United Kingdom National Accounts – The Blue Book, 2013 Dataset. Office for National Statistics. 31st July 2013. Available at: http://www.ons.gov.uk/ons/rel/naa1-rd/united-kingdom-national-accounts/the-blue-book--2013-edition/index.html.

  2. Stiglitz, J. Sen, A. and Fitoussi, J.P. (2009). Report by the Commission on the Measurement of Economic Performance and Social Progress. September 2009. Available at: http://www.stiglitz-sen-fitoussi.fr/documents/rapport_anglais.pdf.

  3. Holloway, Short and Tamplin (2002). Household Satellite Account (Experimental) Methodology. Office for National Statistics. April 2002. Available at: http://www.ons.gov.uk/ons/guide-method/method-quality/specific/social-and-welfare-methodology/household-satellite-account/index.html.

  4. National Travel Survey (2009). National Travel Survey Transport Statistics Bulletin: 2008. Department for Transport.

  5. Tonkin R (2011). The Effect of Duties on Petrol and Diesel on Household Disposable Income, 2011. Office for National Statistics. 14th November 2011. Available at: http://www.ons.gov.uk/ons/dcp171776_241843.pdf.

  6. National Travel Survey (2011). National Travel Survey: 2010 Statistical Release. 28th July 2011. Department for Transport. Available at: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/8932/nts2010-01.pdf.

  7. Clegg R (2014). Labour Market Statistics Dataset. 11th June 2014. Office for National Statistics. Available at: http://www.ons.gov.uk/ons/rel/lms/labour-market-statistics/index.html.

  8. National Travel Survey (2013).  Why people travel (trip purpose) (NTS0403). 30th July 2013. Department for Transport. Available at: https://www.gov.uk/government/statistical-data-sets/nts04-purpose-of-trips.

  9. Tonkin R (2013). Middle Income Households, 1977-2011/12. 2nd December 2013. Office for National Statistics. Available at: http://www.ons.gov.uk/ons/dcp171776_341133.pdf.

  10. National Travel Survey (2013). How people travel (mode) (NTS0303). 30th July 2013. Department for Transport. Available at: https://www.gov.uk/government/statistical-data-sets/nts03-modal-comparisons.

  11. Abraham K and Mackie C (2005). Beyond the Market, Designing Nonmarket Accounts for the United States. National Research Council of the National Academies. 500 Fifth Street, NW Washington, DC 20001.

  12. National Travel Survey (2013). National Travel Survey 2012 Technical Report. 30th July 2013. Department for Transport. Available at: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/225735/nts2012-technical.pdf.

  13. Ginn L (2013). Travel Survey for Northern Ireland in depth report 2010 – 2012. 19th December 2013. Department for Regional Development. Available at: http://www.drdni.gov.uk/final_-_tsni_indepth_report_2010-2012.pdf.

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