THE legacy of Britain’s summer of sporting success could be a boost for UK employees who enjoy cycling, according to a Yorkshire wealth management business.
The “Wiggins effect” is already boosting the number of people taking part in the Government’s Cycle to Work scheme, which sees staff given a tax-efficient way to buy a bicycle through an employee benefit scheme.
Leeds-based Pearson Jones Plc said the number of people persuading their bosses to help them get on their bikes has surged after Bradley Wiggins’s success in the Tour de France and the Olympics, where his fellow cycling team members also achieved an impressive haul of medals.
The company’s director and head of employee benefits, Paul Scott, said: “Using employee benefits schemes means staff can buy new bikes and essential kit through their employers and enjoy substantial savings due to being allowed to pay for these with a salary sacrifice which enables them to pay for such a benefit before deduction of tax and national insurance.
“This means that a £1,000 bike may cost only £680 due to not having to pay 20 per cent tax and 12 per cent national insurance on the purchase.
“The government is happy to give this tax break as it gets people out of CO2-belching cars, relieves road congestion and improves people’s health.”
Prior to the London Olympics, Hugh Robertson, the Minister for Sports and the Olympics, said that a staggering 500,000 people had taken up cycling in the four years since the Beijing Games, when Great Britain’s cyclists exceeded all expectations to bring home seven golds, three silvers and two bronzes. With further success on the road and track over the summer, along with the added excitement of a home Olympics and Paralympics, that effect could be even more significant over the coming months and years.
Cycle Solutions, a national provider of the Government-backed cycle to work scheme, says bicycle sales have risen by more than 40 per cent this year as increasing numbers of bosses view the tax-efficient Cycle to Work scheme as central to their employee benefits package.
Employers who sign up also have their company name listed on the scheme’s official website, recognising their contribution to their employees’ health and wellbeing.
Cycle Solutions director and chairman of the Cycle to Work Alliance, Steve Edgell, who is based in Leeds, said: “The success of Bradley Wiggins in the Tour de France, and the superb performance of our Olympians and Paralympians in the summer, have taken cycling to a different level.”
However, he believes the economy is also a key factor.
“With fuel costs on an upward spiral, commuters have had enough,” he said. “Whereas previously cycling was a hobby, more and more people are making bikes their main form of transport.”
One employer which launched the Cycle to Work scheme in January has been surprised by the level of employee take-up.
Transport company Stagecoach saw more than eight per cent of its workforce join the scheme and now has almost 1,500 employees on bikes.
Cycle retailer Halfords has revealed it had a 14.7 per cent surge in cycle sales in the 13 weeks to September 28, compared with a 7.5 per cent drop in the first quarter – a rise it attributes at least in part to the British sporting successes.
Mr Scott added: “Conditions within the scheme mean that the bicycle in question must be used at least half the time for travelling either to, or part of the way to, work.
“Also, the employer must buy the bicycle and effectively rent it to the member of staff for 12 months before a final payment is made and ownership transfers to the employee – at which point they can do whatever they want with it. As well as the employee making savings, bosses will benefit by making savings in their national insurance liabilities. Handled properly this can be highly valued by bosses and their staff and enhance relationships.
“This is a benefit which has been lightly used and generally only by those who were already cycling enthusiasts, but now that cycling is cool again it is seeing a dramatic upturn which will gather pace in the coming months.
“Politicians have sought an economic benefit from this year’s sporting success and this clearly is one for thousands of businesses and their staff.”