Britons spend more on cars than houses

LONDON, Jan 23, 2003; Francois Murphy writing for Reuters reported that in spite of Britons' reputation as a nation of home buyers, they spend twice as much money on cars as on paying their mortgages, according to a survey published on Thursday.

The Office for National Statistics said in its annual survey of the nation's spending habits that the average Briton spent 398 pounds a week in the year to April 2002, ranging from 127 pounds for the poorest 10 percent to 885 pounds for the richest.

The biggest single item is transport at 58 pounds a week, of which nearly all is for the purchase and running of cars. Mortgage payments, thanks to the lowest interest rates for four decades, only account for about 25 pounds a week on average.

The report, which is used to select the 'basket of goods' for inflation measurements, found that British consumers' three biggest expenses were transport, recreation and culture, and food and drink.

Spending on drugs and prostitution is so small as to be negligible, the ONS said, although it thought respondents probably did not dare list such expenses.

Sixty-five percent of households owned a mobile phone, while five years earlier the figure was just 16 percent, the ONS said. Britain has come a long way since 1970, when just 35 percent of homes had a telephone.

Such electronic equipment came under the heading 'recreation and culture', which at an average 54 pounds a week was households' second biggest expense. It also included internet costs -- 40 percent of homes in Britain had an internet connection, the ONS said.

The definition of expense categories may cause some confusion. Package holidays, for example, were defined as recreation and culture, but aeroplane tickets were defined as transport.

As the report was based on interviews and on diaries respondents kept of the money they spent for two weeks, the ONS said there would inevitably be some mistakes.

DRUNKEN CONFUSION

Bev Botting, editor of the report, said it probably only captured about two thirds of alcohol and tobacco expenditure. "If someone goes to the pub, they may report less than they bought," she said.

The report showed the gap in spending between rich and poor remained large: the richest 10 percent spent almost nine times more on restaurants and hotels than the poorest 10 percent and 120 pounds a week on recreation and culture to the poorest's 16 pounds.

The report also showed big differences between the regions. Londoners, for example, were most likely to go out for a meal -- they spent 40 percent more on restaurant and cafe meals than the UK average.

Only households in London, the southeast and east of England spent more money in total than the UK average. Wales and the North East were 12-14 percent below the average, the ONS said.

Age was also an important factor: the under-30s were most likely to eat a take-away meal and spent roughly as much on going to cinemas, theatres and museums as they did on gambling.

Those aged 50 to 64 preferred a less intellectual night out and spent over twice as much on gambling as on the cinema or theatre.