Cycle to Work criticism is going nowhere, focus needed on solutions

— A range of different incentives are needed to give people access to bicycles, especially for more expensive electric bicycles, cargo bikes and adapted cycles.

COMMENT & ANALYSIS: According to The Irish Times View on the Cycle to Work scheme, it is extraordinary there are no official figures on uptake or cost of the scheme. But what is truly extraordinary is that some journalists are still at this kind of thing.

The Irish Times leader article said: “Extraordinarily, a Department of Transport spending review has found there are no official figures on scheme uptake or cost and notes that estimates vary for each,” and that “the muddled application of what remains a very good idea derives from the model chosen to deliver it…”

It is designed as intended, and working as intended. It’s a tax incentive scheme for employees.

Is it wrong that higher-paid workers benefit more than lower-paid workers? Yes. It clearly is. But that’s how simple tax schemes work. The data and processes of “central control” The Irish Times and others before it are looking for would have likely stalled the process of the scheme from ever being put in place when the Greens were last in Government.

The system’s relative simplicity is what got it over the line, it’s what got employers on boards and a large part of what has made the system work.

Can we do better now? Yes, definitely. Should progress have been this slow? Definitely not.

The Cycle to Work to work scheme is a closed shop and does not provide for a range of people including where employers refuse to take part in the scheme, and it excludes the self-employed, the unemployed or underemployed, retirees, carers, homemakers, school-goers, etc and even businesses.

This is a far bigger issue than the lack of data on the existing scheme. As The Irish Times rightly notes, the scheme “restricts eligibility to the employer-worker relationship and tends to deliver greater savings to people on higher incomes.”

Calls over the years to expand the scheme sound great, but such calls are easy for Ministers and department officials to dismiss. You cannot expand a tax scheme for workers to people not in that the employment tax system.

In the Dail records, there are hundreds of mentions of “Cycle to Work” (the scheme’s official name) and “bike to work” (a private company’s name which has become a byword for the scheme).

Not all of the mentions on the Dail record are people asking for details of the scheme which are impassable to provide or call for it to be expanded with very little idea of what that might entail. Sorry if it sounds harsh, but asking the same questions over and over again when the answer is already published is a waste of parliamentary resources and a waste of time for TDs.

We don’t need to complicate a system that works. Productive solutions are a bit more obvious when we look at what’s already happening in the world.

First off, as this website reported recently, it is still unexplained why Minister Ryan is expanding the e-vehicle fund but excluding electric and cargo bicycles from tapping into it. Grants are far different to a tax incentive that is the Cycle to Work scheme.

Minister Ryan could have included electric bicycles as part of the electric vehicle targets and — followed other countries — in expanding the e-car grants to electric and cargo bicycles in the Budget just gone. With simple legal backing, it would not have taken much to put this in place under the Sustainable Energy Authority of Ireland which administers the current grant.

Grants are also not the only solution.

In fairness to Minister Ryan, he and Minister for State Joe O’Brien in April launched a three-year pilot ‘Upcycling Initiative’ for the provision of “high-quality up-cycled bicycles and e-bikes for those on low incomes and/or those who are most marginalised and disadvantaged.” It is unclear why this would need to be a three-year pilot.

Some councils are already supporting similar community groups or social enterprises.

Scotland and some areas of the US have interest-free loans for bicycles. Other countries have scrappage schemes for older cars which offer funding towards a choice of an electric car, public transport ticket or electric bicycles (some allow you to pay for more than one bike which seems sensible given that that the car might have been used by more than one person).

Whatever mix of solutions we settle on, it should be done quickly.

But first, we need to move beyond looking at the Cycle to Work scheme regardless of if it is retired or stays in place alongside other systems. Calls for it to be fixed or expanded seems to have so-far been a distraction to solutions.

ALSO READ: Around the world: Cargo bicycle and electric bicycle grants and incentives

1 comment

  1. There is absolutely no good reason why the tax credit rate cannot be the same across the board, regardless of income. If memory serves anyone, regardless of their earnings, gets the same tax credit for paying into a pension, so it’s not like it has to be done according to the tax bracket a worker is in. Also, we should consider de-coupling it from e employers (who have occasionally refused to engage with it) and just make it a person tax credit attached to each individual person.

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