MP on Cycle to Work scheme: 'Corporations are raking in profits as small manufacturers and shops suffer'

Fabian Hamilton MP, co-chair of the Cycling and Walking All-Party Parliamentary Group, says the controversial scheme 'must be reformed'

Clock14:17, Friday 2nd February 2024

Fabian Hamilton MP, co-chair of the Walking and Cycling All-Party Parliamentary Group, has said that the Cycle to Work scheme "must be reformed".

Last week, Hamilton met with representatives from cycling industry group the Association of Cycle Traders (ACT), which represents over 500 bike shops, and heard the concerns retailers had with the Cycle to Work scheme.

Among these concerns were suggestions that the scheme was overly complicated, inconsistent and out of date. However, the chief concern was the fact that individual bike shops were forced to bear the heavy administrative costs of the scheme, whilst third-party providers made healthy profits.

Today, in a statement shared with GCN, Hamilton has stated that he too believes the Cycle to Work scheme needs to be reformed:

"The current schemes must be reformed so that small businesses are able to take part without operating at a loss. The intermediaries, that are often large corporations, are raking in the profits while small cycling manufacturers and shops suffer."

Read more: Everything you need to know about the Cycle to Work scheme

The intermediaries in Cycle to Work schemes are private businesses that facilitate the scheme for employers. The main providers are Cyclescheme, Halfords Cycle2Work, Evans Ride to Work, Bike2Work Scheme, Green Commute Initiative and GoGeta.

These providers buy bicycles from bike shops on behalf of participants in the scheme, then rent the bikes to the participants. The administrative cost of this transaction is high, and at the moment, it is lumped almost entirely on the individual bike shops.

The scheme might need reform, but Hamilton makes clear that schemes of this kind are a good thing, saying:

"Schemes that promote cycling are vital to public health and tackling the climate emergency."

Indeed, Hamilton sees the bicycle industry as a key part of the "new industrial strategy" that the Labour party is campaigning for at the upcoming general election. He concludes by saying:

"Cycling businesses are integral to this [strategy] and we will make it as easy as possible for them to do business in the UK."

For more of the latest updates, see our general news section

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