18
Examination of witnesses
Paul Swinney, Christina Calderato and Danny Vaughan.
Q113 The Chair: Good morning, and welcome to this House of Lords Select Committee on home-based working. We are in a public evidence session today so the session is being broadcast. A transcript will be sent to our witnesses in a few days’ time to check in case there are any transcription errors; you are more than welcome to answer any supplementary questions in writing after the meeting.
I am going to kick straight off with the questions and, if you could each introduce yourselves the first time you speak, that would be great. You need not answer every question but do feel free to contribute wherever you wish.
I want to start by asking you to describe the situation regarding data on remote, hybrid and office-based working, in particular with regard to UK cities. What data do you have? Are there particular gaps and what picture is emerging?
Paul Swinney: Good morning, everybody. I head up the research team at the think tank Centre for Cities. We look at the geography of the UK economy, which bits are doing well, which bits are not, and what that means for policy.
Obviously, cities are in our title so remote working and the impact of Covid is something that we have been following very closely, but there has been quite a large lack of data. The response from the ONS was to start tracking hybrid working, but understandably there was some delay and by the time it started to include questions about hybrid working within their surveys the nature of home working had already changed.
Hybrid can mean a number of different things: it could mean you are in the office one day a week or one day a fortnight, or it could mean you are in the office four days a week. The ONS only had a binary measure of, “Do you work from home sometimes or do you not?” Given how things have changed, that does not really tell us very much.
We have done a number of things to fill that gap. First, we have used TfL data, which has been very helpful in looking at commuting patterns. London is in a fairly unique position in the UK in that such data is made available, and it allows us to say something about the situation.
Secondly, we have filled the gap ourselves through a number of surveys of central London workers and central London employers to get a better understanding of what hybrid working looks like and how it has changed.
Christina Calderato: I am the director of strategy at Transport for London. It might be helpful if I talk about what data we gather. We have an annual London travel demand survey which asks people about the travel they have undertaken; that is one of the ways we can find out from Londoners what trips they are taking for what purposes and how that has changed. The post-pandemic increase in the ability to work from home has definitely had an impact on travel patterns, but we have also seen that pattern now starting to stabilise. In 2024, those commute patterns actually went up ever so slightly, but there is a much broader range of trips within the data: there are commuting trips but also other business trips. So, if there is less commuting, there might be an increase in other business trips. Last year, we saw a slight increase in commuting but a reduction in other business trips, which probably speaks to the impact of the ability to have hybrid meetings with external partners.
We draw some information directly from Londoners directly and then, as Paul says, we make that information publicly available for people to use and analyse for themselves.
The Chair: Presumably, you have a lot of data on the numbers of people travelling and at what times, simply by tapping in and out; is that data public?
Christina Calderato: We have huge amounts of data, much of which is available as open-source data. We also wrap it up in analysis reports, which are probably more useful for most people. Every year we publish the Travel in London report, which looks at the year that has just passed and explains the differences in trends and patterns. It enables us to take a really holistic and long-term view of what is happening with travel in London and how travel patterns are changing.
The really important point is that we can see that travel patterns are changing, and in part that is due to home-based working, but there are a lot of other things that are changing within those travel patterns as well.
The Chair: Just to finish off, you would know from the data—or you would be able to have a good guess—that people are going out on Thursday evenings instead of Fridays and they are not coming in on Friday and Mondays.
Christina Calderato: Exactly; we can see the pattern of usage across the week and it is slightly below pre-pandemic across most of our modes. The bus and tube are around 90%, London Overground is at 97% but we now have the Elizabeth line, which is hugely busy. So, we do not have a direct like-for-like comparison. We can see that total trips are lower across the week and commuting trips are lower on Mondays and Fridays especially, but we have seen increases in other types of trips. Weekend leisure trips are back above 100% of pre-pandemic levels. So, there are quite a lot of things that are moving around. Although the pandemic led to a bigger and more sustained change in the way that people work from home, we have seen longer-term trends in the changing working patterns as well.
It is also really important to remember that not everybody can work from home. When we look at the information from the London travel demand survey, around 53% of people are not able to work from home; 35% of people are able and can work from home, and about 13% of people would be able but are not encouraged to work from home. For the majority of people, working from home is not an option.
Danny Vaughan: I am the chief network officer at Transport for Greater Manchester. Like Christina and TfL, we have the same very rich data sets, but we probably notice different trends. The Metrolink tram network, which is the largest light rail network in the UK, has been under public control for many years so we have detailed granular data from before Covid right throughout the pandemic and up to today. We are keen to look at these very detailed patronage trends because that data assists both short-term decision-making and long-term planning on the transport network.
Since 2023, we have taken the bus network back under public control as part of the Bee Network. That has been done in tranches, from the north-west of Manchester—Wigan and Bolton—in September 2023, right up to all of south Manchester in January this year. We now have detailed granular information on bus travel patterns and it is very insightful. Bus and rail-based modes, we think, do very different things.
For example, we can see that patronage on the trams has recovered in Greater Manchester to beyond what it was pre-pandemic; it is now at 105% to 110%. The leisure market on the weekends is probably 120% of the volumes in 2019, so much so that our biggest problem now is how we cater for that demand in future.
We can see the same pattern of behaviour on the rail-based modes. People tend to work from home on Mondays and Fridays; Fridays are our quietest day of the week, which is not to say that trams are not busy. But we do see a leisure market build up on Friday evenings, for example.
What is different to the pre-pandemic situation is that Manchester has grown, and Greater Manchester is doing very well in its own right. That has a lot to do with investment in public transport, the expansion of the tram network, and more recently the Bee Network and bus franchising. It has become more of a leisure destination, so weekends are always very busy; one of the big football clubs always has a home game. We have invested a lot in the leisure economy through the Co-Op arena, and the transport network is designed around that, so there is huge demand and huge growth. In fact, since we took over the Bee Network in September 2023, there has been 15% growth in bus demand. Year on year we are looking at 17%, so it is in consistent double-digit figures.
The interesting difference between our bus users and our tram users is that bus users are probably less likely to work from home. Bus demand is steady Monday to Friday, virtually every day of the week. It is consistent and reliable in terms of demand and how we need to plan the bus network. It is growing, but there is not that much difference between weekdays on buses, which, to Christina’s point, probably indicates that some people are less able to work from home. The buses serve different demographics.
Q114 Lord Parker of Minsmere: Paul, can I pick on you for a minute? Thank you for sending in your written evidence. Could you talk to us about your findings on the pros and cons for city economies of different styles of working, across the range from present in-person to hybrid to fully remote? What are you seeing in city economies?
Paul Swinney: There are definitely costs and benefits on both sides; it is not the case that fully working from home is all sunny uplands, but there are also downsides to being in the office all the time. There are a number of theoretical reasons why that would be the case. We have asked people what they think the costs and benefits are of being at home or being in work, and we have some data around that as a result.
There are definitely short-term or immediate benefits to workers in working from home. During 2020 and 2021 and the whole work from home debate, there was a focus on those short-term immediate benefits, such as not having to pay for travel, not having the time expenditure of travelling and having more flexibility over how time is used through the day. When we ran the survey, these continued to be the main benefits people noticed in working from home. People of child-rearing age raised childcare as an issue as well.
If we had run the survey in 2020 and asked people about the benefits of being in the office, certainly from the public debate it would seem that people would have said, “Well, there are very few reasons for being in the office. I have my computer and my internet connection; the genius pours out of my head and through the keyboard and magic things happen”. But when we ran the survey last year in 2024, there had been a big shift in that view. Only 5% of the people we asked in central London—that is one in 20—said that there was no benefit to being in the office; those numbers were consistent across the other five international cities we surveyed.
There is a recognition now, even from employees, that there is a benefit to being in the office. The main reasons they gave were around collaboration, in terms of being able to share ideas and information, but also about being able to build a network and relationships with colleagues. Learning on the job was a factor as well.
The benefits of flexible working, like I say, are very immediate: you see them in the fact that you are not paying for bus or train travel or for petrol, or whatever it is. The costs that are involved in not being in the office are potentially less easy to observe and longer term in nature, so we need to be a little more aware of those potential long-term costs rather than assuming they are not there. Those costs result from not having so much face-to-face interaction and from not having so much on-the-job learning. If you do not have this interaction going on, you do not have that spontaneous conversation at 4.37 pm on a Monday, of, “Well, I just heard you talking about that. Actually, have you thought about this? Because I had a conversation with somebody over there. Oh, wow, that’s really helpful”. That interaction could unlock a new idea that might make the company more profitable. If a problem happens and you are sitting next to a colleague who has 15 years’ worth of experience, you can observe how your colleague responds and learn something. Interaction has implications for future profitability and productivity, but it also has implications for future skill accumulation, which can have an impact on wages and career progression too.
You do not observe this issue in three months or six months. You probably observe it two, three, five or 10 years down the line. That is the concern we need to be aware of; there are definitely costs and benefits on both sides, but we should not be blind to the benefits of office working, which are long-term and hidden in nature.
Lord Parker of Minsmere: Could you take it up a level to the macro view of how this is changing our cities versus our rural towns and villages? What is happening at that macro level?
Paul Swinney: Probably the first thing to observe is that patterns of working now in 2025 are much closer to what they were in 2019 than what was being predicted in 2020 and probably in 2021 as well. At that stage, it was said, “We’re all going to work from home for ever. The office is dead, and city centres are going to hollow out”. That very clearly has not happened. Now, it might seem like an obvious thing to say, but the psychology of the debate seems to ignore the fact that those predictions were happening in 2020. Our survey from last year shows that we are actually in the workplace just under three days a week on average in central London, so we are much closer to pre-pandemic levels. Even in 2019 the average was 4.1 or 4.2 days a week, and there were people who did not go into the office on a Friday. So in that respect it is not new.
What that means is that the impact on cities has been much less than was predicted. The transport network in London and Manchester, as colleagues have said, is definitely quieter on Monday and in particular Friday, and that has potentially had an impact on worker spending in city centres. We have done some work on that, which we might come back to later. It has shifted to Thursdays in London and it seems to have reduced in other large cities too.
But the impact on towns and villages outside has probably been less than was predicted too. If you are required to be in the office, say, three days a week, the ability to go and live out in rural west Wales is much less than it was when suddenly you could work from home for ever. It is also interesting that even on the work-from-home days that people tend to have on Mondays and Fridays, there does not appear to have been a huge increase in neighbourhood spending. My suggestion would be that if people are embracing a digital lifestyle through work, they are probably embracing that through leisure time as well and clicking on the Amazon website rather than going down to the local village shop. I do not have the data to look into that, but it is worth holding those things in mind.
Danny Vaughan: From our perspective, the tram network is back to 2019 levels, with the exception of Fridays, so it feels like we have moved on a little.
One of my worries is that, as a result of the mindset in 2020, when we planned a lot of scenarios for what cities would look like in the future, we collectively lost across the UK a little of the planning time and implementation time for major infrastructure. We are probably playing catch-up now in the demand for transport, certainly in transport infrastructure; we are looking at longer vehicles and extending some parts of the tram network. We already cover seven of the 10 Greater Manchester local authorities and there is demand for more. So, personally, I do not see a difference in that demand for infrastructure and transport services between 2019 and now.
We may be a bit of a unique story, though, in terms of our ambition for Greater Manchester. We have continued to do things like the Bee Network, taking buses back under public control. We are the only city outside London that has integrated ticketing and we are doing well at encouraging people to use those networks. We like to think that Greater Manchester—certainly the regional centre—is an example for others to follow in growing the economy more generally. If you look at the Manchester skyline, it has completely changed, certainly over a decade but even compared to five years ago at the start of the pandemic. We have brought a lot of housing to the inner regional centre as well as in some suburbs. Again, that housing places extra demand on the transport network. People still want to get into the city and the city is more vibrant than ever.
On a different note, we have seen some reuse of office space; certainly, there is evidence that employers are trying to make their office space attractive to come back into. In some cases, the office feels more like home. But by and large, I would say we are on a growth trajectory and have almost moved on.
The Chair: On that latter point, if you have some information you can send to us it would be helpful. It would be really interesting to know more about how the use of the city has been changing—even this quite granular but interesting stuff about how offices are being developed and made more attractive.
Q115 Baroness Freeman of Steventon: This question is for Christina and Daniel mainly. Digging into your transport data—you have given us some really useful top lines on it—what changes can you attribute specifically to changing working patterns and working from home? Obviously, with your survey, Christina, you can actually ask people. I do not know if there are ways in which you can do statistical attribution on the other data. How are those changes affecting your planning for the whole of public infrastructure and transport?
Christina Calderato: Paul was talking about the difference between cities and rural areas. Although it probably does not count as rural, we see a difference between those working in London and living in London who are coming in probably 2.9 days a week, close to three days a week, and those who work in London but live outside London, who are coming in more like 2.1 days a week. So we do see some differences in patterns that are fleshing out the shape of what is happening and how travel is changing. But for me it goes back to the fact that a lot of what is changing is separate from this question. The survey that I was talking about has observed a pattern of generally falling trip rates ever since it began in the early 2000s. They picked up a little just before the pandemic, but we are still not back at total trip rates. Within that, we see a change in working patterns during the week: Tuesday, Wednesday and Thursday are busier. Similarly to what Danny was saying, we are seeing leisure trips at the weekend: Sunday is very strong. So there are definitely changing patterns that we need to look at, but there are much wider factors influencing the way people are using the network that we need to consider when planning for future needs.
Over a long period of time we have seen a decline in leisure trips. They held up and bounced back quite strongly after the pandemic, but in the longer term they are on a declining trajectory. A lot of the changes we have seen have been a response to the cost of living and a change in the different types of trips that people are making.
We are also seeing changing demographics in the city: there is a lower birth rate. London is still a young city, but we have a slightly older population so there are increases in groups that tend to take fewer trips overall. It is important for us to understand the impact of home working, but that is happening within broader changes that we also need to understand and plan for.
In terms of the benefits and flexibility that we see with home working, there is a knock-on impact on trips that people take around work. We see a reduction in those types of trips that might be associated with being in the office on a workday. Part of our core purpose is making sure that people who live and work in the city can take advantage of all the things that living in a city and living in London has to offer. We are seeing a reduction in those extra socialising or additional trips that you might do if you were coming in to work. So it is a bigger picture with more implications than just the commute pattern.
Baroness Freeman of Steventon: Just to come in on a couple of those points, how much do those changing patterns affect your income streams, your pricing and the patterns of train and bus availability?
Christina Calderato: Although trips are slightly down on where they were pre-pandemic, we have bounced back strongly, so the need and requirement for our services is still high. We are very reliant on fare box income, so that does have a bit of an impact. One of the things that has been challenging for us, probably throughout the same period that we are talking about here, is that we have had a series of short-term funding deals which have made it hard to plan for the investment needed in assets and infrastructure. Reliable services are part of what makes it attractive for people to come to work: they need to know there is a reliable infrastructure that will get them where they need to be. So we need to continue to invest in making sure we have that reliability and level of service for the very high numbers of trips we are obviously still seeing.
As I say, the pattern has changed a bit, but we are still planning for growth and we are looking at how we can support growth. The Elizabeth line demonstrates that, when you provide that additional capacity and additional connectivity, people will use it, and it has attracted a huge number of trips. Similarly, we are planning our services a bit differently. You might have heard about the Superloop buses in outer London, which provide express services and outer London town centre connectivity. Again, we are seeing the ridership and demand for those outstripping traditional buses. We are continually trying to adapt to the services that people need and to make sure that we are providing them.
Danny Vaughan: There are probably a few disparate points to make in answering the same questions. What is interesting in looking at our bus passenger data is that our peaks—certainly in the evening—are driven by school kids getting to and from school. That is a really important point to remember because most of the time we want our kids in school Monday to Friday and, as Christina said, family travel patterns tend to be dictated by childcare needs and schools. Obviously we would prefer children to walk or cycle, but if they are using public transport that is a good thing. So we see a huge demand on the school network.
While we can say that passenger numbers are lower on Fridays, for example, again Thursday is now the busiest day on the tram network. You need to plan any transport network for the busiest time. You cannot just smooth out your supply across the week; you have to actually design for the peak of the peak, so that keeps the costs pretty much as they were.
Revenue-wise, an interesting thing to point out is that the tram network was profitable; it was one of the very few public transport networks that did not require any operating subsidy pre-pandemic and in fact made enough money for us to pay off some capital investment in the network. It was self-sustaining and a very good success story. While passenger numbers have recovered, in the meantime we have had periods of hyperinflation, higher energy costs and so on, so we are not quite back to breaking even on the tram network. We have, however, made a deliberate decision to keep fares low. Greater Manchester is one of the only regions outside London to keep the £2 bus fare cap; we would like it to be as low as in London. That, we think, is part of the reason that is driving patronage as well. We are not just looking at transport; we are trying to shift the whole economy by enabling people to move around easily and cheaply.
Baroness Freeman of Steventon: Is your data open and available for study?
Danny Vaughan: We tend to publish our data through the local committees of Greater Manchester. We do not generally make it open data, but we have no objection to doing that. We publish reports on a fairly regular basis—roughly every six weeks.
Q116 Baroness Featherstone: How have remote and hybrid working impacted spending patterns and public transport revenue in cities, including the location, the nature and the purpose of expenditure?
Paul Swinney: We published some work on this just a couple of weeks ago, using credit and debit card data. It was fascinating to see. We were able to look at workers in central London but also workers in all the other large cities as well, ranging from Liverpool and Nottingham up to Manchester and Birmingham. We were not able to measure absolute levels of spend because of the way the data came to us, but we were able to look at what share of that spend happens in certain places. We found that workers were spending less of their overall spending in city centres. That was the same across London and the other large cities: the decline reflected the fact that there is greater hybrid working now than in 2019. But the increase in the share of people spending money in their local neighbourhood was much less than the decrease in the city centre.
Again, there was this story in 2020 and 2021 that it was all going to be fantastic for local high streets because people were not commuting into the centre to spend their money in Pret—or wherever else they might go to spend their money—but instead were going to go to the independent café on their local high street. That might have happened a little, but certainly not to the extent that people were suggesting. There has not been an equivalent big bounce in local spending to match the decline in the share of spending that is going into the city centre.
From our data, it looks as if suburban supermarkets have probably been the biggest winner from this shift in the share of spending happening within city centres, which I certainly do not think was what people had in mind when they were making predictions in 2020 and 2021.
The most interesting element was the performance of the Friday night drink. Pre-pandemic, most of us would be in work on a Friday and I am sure there would be the suggestion, “Oh, we should go for a drink after work”. Clearly, that is more of a struggle now, given that fewer people are in the office on Friday. In London, the Friday night drink has not gone away; it has just shifted to a Thursday. If you go for a walk through London Bridge—where we are based—or through the City of London on a Thursday night, you will see people spilling out on to the pavement in the way they used to on a Friday night. So it seems that there has been more of a shift rather than a decline.
But that was not the case when we looked at other large cities. It appears from our data that the post-work drink has reduced in those other places. It did seem to be a thing on a Friday night, but there has not been an increase in spend share on a Thursday. The shift seems to go into the weekend, with workers coming in from a leisure perspective rather than going out after work. So there are some very different patterns going on: in London it seems potentially to be a reallocation during the working week, whereas, in other large cities, hybrid working seems to have led to a reduction of weekday spending by workers in the city centre.
Baroness Featherstone: Before I move on to the other two panellists, do you know in percentage terms what the loss has been to central businesses, pubs, restaurants, cafes or whatever?
Paul Swinney: I do not know off the top of my head; I apologise for that.
Baroness Featherstone: You can write to the committee; it is just that I have no sense of what the decline has been. Do either of the other two panellists want to come in on this?
Danny Vaughan: It is probably more difficult to answer, but it is true that revenues have had a scarring period. There were a couple of years when we were in fact encouraging people not to travel. Obviously, we had reduced revenue and the DfT helped us keep our services running. We did not reduce the service level, so we were quicker to recover, but none the less we lost at least two years of growth. We are a bit behind where we need to be.
Revenues have now fully recovered, so they are 100% of what they were in 2019, but that is not to say that we are making up for costs. As I said a minute ago, costs can be as high as 130% or 140% of what they were pre-Covid, but through that period we have kept fares as low as we can. That was a deliberate choice to encourage people back on to the transport network.
We only have more granular data on the bus network since we did bus franchising in September 2023, and we only have the full bus network since January, so it is a little difficult. But what I can say is that, already in this financial year, with that very strong growth, we are 1% or 2% ahead of where our budgets were for revenue. That is not to say that bus revenues are making up entirely for bus costs—there are concessionary fares and other means to subsidise some losses on the bus network—but overall our target is for volume and for further growth in passenger numbers.
Baroness Featherstone: Before I go to Christina, I am going to add in a question: do we have any quantifiable measurement of impact on the environment, in areas such as emissions or air quality, or anything like that?
Danny Vaughan: I can say we probably do in Greater Manchester. I do not have them to hand, but I can submit those afterwards.
Baroness Featherstone: Can you send them to the committee, please?
Danny Vaughan: Yes, absolutely. I would just make one observation, though: in looking at transport trends generally from the Covid era, highway traffic was the fastest to recover and public transport is catching up. That might hint to an answer to your question.
Baroness Featherstone: That was not the answer I was looking for.
Christina Calderato: We have not bounced back exactly to where we were pre-pandemic; we are slightly below that, and again there might be broader long-term trends at play as well. That does have an impact on the fare box. We are quite unusual in not having government revenue support, so it does have an impact on us, although we made a surplus for the first time last year so we are trying to manage the way that we are dealing with those finances. It is challenging when the demand is lower.
We have talked about Thursdays being the busiest day on London Underground, and Danny has alluded to this on rail services and bus; it is certainly true. Although Sunday is the least busy day, that is the day that has rebounded most strongly. On the buses it is a more consistent picture across the week: you do not see that same pattern in bus usage, and that speaks to the fact that people who are reliant on the bus may be less able to change their pattern of trips than other workers.
There are certainly challenges for us in terms of ridership. Again, we are looking to make sure that we are providing services that people want and need. So we have the Elizabeth line, as I have just referenced, and the Superloop: the demand for that is about 15% higher than on other bus routes. We are trying to adapt, to make sure we are providing services that will bring people back to the network and back to travelling.
Another long-term impact we have seen from the pandemic is that the bounce in active travel stayed high, which again is a really positive thing. To your question about emissions, we had those lost years in London but we are back on the right pathway again now in terms of a shift to sustainable modes of transport. Traffic bounced back very quickly but it is at lower levels now and people are moving towards public transport and active travel.
There are lots of positives within all this data, but the world has not gone back to the way it was before and there will be implications for us in that. Our job is to keep providing the services, making sure that they are priced fairly, that they are accessible and that they provide connectivity for the journeys that people need to make.
The Chair: Would it be difficult to say that people working from home save us so many tonnes of CO2 because they are not commuting? What I am hearing is that it is a very complicated picture and that it would be quite difficult to make that attribution with confidence. Is that fair?
Christina Calderato: That is fair. Trip patterns are complex; it is not as simple as going to work and working from home. There are also a number of other changes that are going on around, for instance, emissions from our services. We are continuing to invest in a zero-emission bus fleet; that is going to change the emissions. We have the Ultra Low Emission Zone. There are other things that will impact on that, so the simple idea of trips to work versus no trips to work is not that easy to disaggregate.
Paul Swinney: There is a counterintuitive point on this too. Those people who live in rural locations and commute into the centre of London or the centre of Manchester are likely to take public transport to get into work and maybe do some leisure-based things while they have made that trip and the train is still running, or the bus is still running, irrespective of whether they get on that bus or train. If instead they are working from home in a more rural location and then need to pop out for something, they are probably going to use their car. So in some respects you might actually see an increase in carbon emissions and nitrous oxide emissions from more home-based working rather than a reduction. We should bear in mind that public transport does not stop or should not stop because somebody is not going into work—but car journeys might increase as a result.
Q117 Lord Fuller: I have been really looking forward to this session because hitherto we have had a lot of opinion—many people have strong views on home working one way or the other—but now we are getting into the data. I am really impressed by all the witnesses who have the facts at their fingertips. I want to ask about office space, not about transport as such.
Paul, what have you noticed in the general office market? If more people are working from home, particularly in clerical work that can be done from the office as opposed to building a house, what differences have you noticed in London? The evidence from this session appears to show that it is a slightly different proposition to the rest of the economy.
I am also going to ask Christina and Daniel, in so far as your own organisations are concerned, what are your plans for your own office space? Have you cut down on office space? If you are involved in a lease, are you planning to trim back when it comes to an end? In other words, how are you dealing with the situation?
My final question is about data, because I was not quite completely sure about Baroness Freeman’s point on that. Where you are publishing open data—I would certainly encourage Manchester to do so—what second order academic research are you aware of? Clearly you are publishing your own data, but do you have connections with academics at King’s College or elsewhere who can interpret it?
So this is a three-part question on office space, data and what you are doing in your own businesses.
Danny Vaughan: On the data point, we publish the performances of our networks and so on. We are probably a little behind in patronage data and publishing that regularly; part of the reason is that we have just taken over the bus network and it was patchy. We are in a very good place now to publish more granular data, so we will.
Regarding second order research, we do partner very well with some Manchester universities. I am not aware of any specific studies around patronage, but we do engage in that kind of research all the time and are absolutely happy to do that.
In terms of our own office space, we are a larger organisation than we were pre-pandemic. We have a number of facilities, in particular centred on an office building right outside Manchester Piccadilly station. We own the building but we never fill it, so we have had conversations about leasing out floors for coffee shops and other things such as partner organisations who need central Manchester locations. We have not done it yet but our offices are not full, certainly not on Fridays. It is difficult as we cannot just lease out part of the building for one day a week.
Christina Calderato: In terms of our own offices, there are two aspects to this at TfL because we have also have Places for London, TfL’s property arm. What we can see from that, and it is probably mirrored in our own organisation, is that companies are increasingly looking for more flexible space. That is what we are certainly doing within our own offices: rather than floors filled with banks of desks, we have different types of meeting spaces and breakout spaces to really maximise the benefits of having people in the office and face-to-face interactions. Places is partnering with Helical to deliver state-of-the-art workspaces at Bank, so that is something we are providing as well as adopting that approach within our own offices. We are making sure that offices are pleasant and attractive places to be and to work in so that you can actually make the most of that face-to-face engagement rather than simply having lots of desk space. In the office building I work in, Palestra, the seventh floor has just been rejigged to have lots of different types of spaces to allow for that type of engagement.
On the data, we work with lots of other partner organisations as well as working with the GLA and GLA Economics. It might be worth me providing a bit of a note about how we do that because it is a really rich story on data and I do not have it all here. We can certainly provide a follow-up about what we make available, how we make it available and the partners we work with.
Lord Fuller: I will focus on that data question because, at a previous evidence session, we heard people say, “Well, we used to deal with the TfL data but they don’t publish it anymore so it can’t be cited”. I think it was from King’s College, but I would stand corrected.
I just want to be really clear: have you moved the data? Have you changed the way in which it is presented or used different formats? I do not know, but it seems that this is quite an important issue, particularly in London, which is the engine room of the economy.
Christina Calderato: I am not sure what they would be referring to; I do not think we have made changes in the way we make that data available. A lot of the data I am talking about today we publish—transport geeks might know this—for the Travel in London report. We publish it once a year, and it is a kind of encyclopaedia of those longer-term trends. We have started publishing more under that banner. We still do the annual report, but we are now drip-feeding some topic-specific reports so that they come out in a timelier fashion throughout the year. We are certainly trying to be open with that data; we might have adjusted it on the website or something, but I can come back and make sure that people know where to find it. If there are any challenges with people being signposted to it or not being able to find it easily then that is something we can usefully address.
Lord Fuller: Paul, what about London versus the rest of the economy and office space?
Paul Swinney: Just on the transport data: TfL opening up its data has been fantastic and we are one of the partners who have worked specifically with TfL to understand more of the granularities as well. My understanding on the access to data is that maybe the cyberattack of last year meant there were some larger organisational issues that had to be dealt with in the short term.
Christina Calderato: Yes.
Paul Swinney: Perhaps that is what the problem was, as opposed to TfL stopping access to the data just because it did not want people getting it any more.
In terms of the nature of office space, there is no publicly available data set for this but the agents produce a number of their own data sets. There are always things hidden in the rental data, so it is never quite comparing apples with apples. But looking at that data and then talking to the agents, the impression seems to be that the premium end of the office market has held up in terms of rents in central London, and that is the case in the other big cities as well.
With second-tier and third-tier office space, rents have been more of a challenge. It seems as if companies have the idea that, if they are going to get people back into the office, they need to be providing a certain type of offer, which is why they are chasing the grade A type office space. Mixed in with that, some older office stock is less desirable because the law is changing around what EPC rating it must have, and that impacts the demand for it. Those are the general patterns.
As Danny said, it is exactly like the public transport network: in London we are not far off where we were pre-pandemic on Thursdays, and Tuesdays and Wednesdays are pretty close as well, but you have to supply the same office space throughout the week that you will be supplying at peak times. Even if 50% of the desks are empty on a Friday, you still have to have that space. So flexibility in that respect is quite hard in terms of reducing your overall floor plate.
The other thing to say is that there has been quite a lot of emphasis on companies trying to make offices nicer, and that issue is seen as a reason why people do not commute in. But in our survey we asked people the reasons why they did not want to go into the office, and only 17% of central London workers responded with, “I do not like being in the office”. Ideally, that would be 0%, but, still, 83% of people do not mind being in the office. Maybe that is because there have been interventions over the last couple of years that have made the office nicer, but it does not scream that the layout of the office is an enormous problem. Things like transport costs are much more likely to be the reason why people are not going in.
A lot has been made of the configuration and quality of office space, but the data from our survey does not necessarily back that up as being a principal reason.
Baroness Manzoor: Can I just follow up on that in terms of costs? Obviously, there are costs for people working at home just as there are for employers. Has there been a change with the cost of living increase, as you mentioned, Christina? Has that had an impact? Obviously heating is very expensive, and insurance cover is as well; are all those things showing up in the data in any way?
Paul Swinney: There is nothing that leaps out from the data to suggest that that would be the case, although it is hard to pick those types of things out. What I can say from our survey is that people are definitely aware of the costs of home working versus commuting in. I imagine that was figuring into people’s considerations, but there was certainly not a huge spike in the return to work data around the time the electricity price jumped in order for me to say anything conclusive on that.
Q118 Baroness Watkins of Tavistock: I have a supplementary question to do with children and whether they are actually going to school. I felt very heartened by what you said about Manchester, but our data also shows that the numbers of children not going to school are far higher than pre-pandemic. There is an argument that some of that is around parents not working five days a week and therefore keeping children at home because they do not feel very well, whereas most of us in the old days would have said, “I have to go to work so you go”. Alternatively, children in their teens are being challenging and saying, “If you don’t, why should I?”
I want to bring that into the question: how much does remote and hybrid working affect the residential choices of people living in cities? What are the implications for transport and infrastructure, in particular thinking about single people as well as families, in relation to getting children to where they need to go? Is there any difference? What is your data showing on that?
Christina Calderato: I might deal with that education point first: I cannot speak to the specifics of what you are talking about, but my own children’s school is very clear that they have to go in unless they are at death’s door, which is fine by me. In 2024, our education trips were up 13% compared to 2022-23, so that drop-off is not something we are seeing in terms of transport trips, which is the only part to which I can actually speak.
In terms of choices about where people live, again this is not my data or my expertise. We have probably all seen things about how during the pandemic there were people who moved further out. We have seen that there were other people moving in and that some people who moved out are maybe looking to move back in. What it has affected is what people are looking for in homes: they are looking for space, they are looking for light and they are looking for the ability to work in those spaces. Again, I am probably speaking more from a Places for London position now, but we know that what is really important to people is where those homes are, the amenities around them and their access to transport and local services.
So, yes, it probably has had an impact on what people are looking for from their homes but in terms of overall population there are, as I mentioned earlier, broader trends at play. In terms of actual transport trips, those are more related to the longer-term trends around what is happening societally, the cost of living, changes to leisure trips and so on, rather than people making residential choices.
Paul Swinney: We have looked at migration data within the UK to understand what this looks like. There were all sorts of discussions in 2020 about the race for space: people trying to get out of the city because they did not need to be there any more and wanted more space instead. It was understandable that that might be the case, and certainly in 2020-21 that seemed to increase.
One of the confusions at the time—that probably was not recognised—is that London loses people to the rest of the country. That always seems to come as a surprise to people. The reason why London’s population continues to grow is because of higher birth rates and international migration into London.
In terms of the interflow between London and the rest of the country, there is a net outflow. That net outflow is largely driven by people aged 30 to 45: they leave the GLA boundaries, but two-thirds remain in the greater south-east because they still want to be linked to London’s labour market through good transport links. They are not cutting ties to London completely; they are just looking for something slightly different at that stage of their lives.
When the pandemic hit in 2020-21, those patterns accentuated. There was an increase in the net outflow from London, but it followed the same pattern: people were still generally moving to the greater south-east rather than Cornwall, Scotland or wherever it was predicted that people were going to move to and never see the office again.
What I cannot tell you with so much certainty is what has happened since then, because the ONS has not published the data in terms of internal migration and which local authorities people move from and to. It is quite frustrating because we cannot understand exactly what has happened.
If we instead look at data on property rentals, what we unsurprisingly see is a collapse in property rentals in 2020-21, in central London in particular. There has been a rebound in those rental prices since, which would suggest that demand has started to increase again for living within inner London, and out of London to a degree, relative to where we were in the pandemic. That goes in line with the fact that the city has reopened. So when the pandemic came, all the benefits of being in the city were squashed because you could not get access to your job and you could not go out to a bar, café or restaurant. When the city reopens again, all of a sudden people go, “Well, the reasons why I lived in the city in the first place are there again”, so the balance changes once more.
That was an entirely predictable pattern that seems to have come to pass, notwithstanding the challenges we have with colleagues from the ONS producing more up-to-date data. At the time of the pandemic, we were predicting that the world was going to change for ever and people would not want to live in London any more. I do not think that is the case now.
Baroness Watkins of Tavistock: So it has not really affected your predictions for transport infrastructure so far?
Paul Swinney: No.
Danny Vaughan: Greater Manchester has probably attracted some of those people, Paul. We have seen growth, certainly in demand for housing. Greater Manchester at the time offered cheaper housing and more space, and it still had good transport links, which is something we are trying to improve.
One trend we are seeing is an increasing number of planning applications for high-density and high-rise buildings in the centre next to good transport links—next to the tram network and the rail network—and this is something we are trying to exploit in terms of planning, certainly in the Greater Manchester area. Last year, we opened a new bus interchange in Stockport, and it is a really good example because the project included a consideration of how to develop that area for housing as well for the first time. Our future projects will be more like that: linking housing to good transport connections. It has certainly been attractive in terms of sales of the apartments. However, I cannot speak to the demographic.
Baroness Watkins of Tavistock: I am afraid I have not been to Stockport for a long time. I have been to Manchester often, but can you give me a feel for how long it would take an essential worker such as a nurse or a teacher to get from Stockport to, say, the main hospital or university?
Danny Vaughan: The train from Stockport to central Manchester takes 10 minutes.
Baroness Watkins of Tavistock: I am trying to get an idea of where people want to live. So it would be that quick?
Danny Vaughan: Yes, it would be that quick, but it also has one of the busiest bus routes in the country as well: the 192, which is fantastic and runs every two minutes. It is very well connected for transport and there are plans to bring the tram network there as well.
What we are seeing is that transport can be an enabler to regenerate town centres around Greater Manchester; Stockport is the best example. We plan to do that more and more in town centres within an easy commute from the regional centre of Manchester.
Christina Calderato: People want to live in well-connected places, which is something we see across the board.
Baroness Watkins of Tavistock: That is really helpful for us. I can see how much people who are working five days a week in the office want that, but I am also hearing you say that hybrid workers want it also. That gives us a very clear answer.
The Chair: That is great. Thank you very much; I can tell that the committee has really enjoyed your evidence. We like data and you have given us plenty of that, but you have also painted a picture as well. One of the take-outs for me in particular has been just how specific that post-pandemic period is, and that what is happening now is important. That has really been helpful, so thank you very much indeed for joining us today and I hope you have enjoyed it.
