Young Drivers: Government Support

Bill Wiggin Excerpts

Tuesday 20th February 2024 Westminster Hall

[Sir Bill Wiggin (North Herefordshire) (Con)]

I congratulate the hon. Member for Upper Bann (Carla Lockhart) on securing this excellent debate. I agree with everything she said.

This is a critically important subject because the price of insurance for some young drivers has now reached £3,000. The high costs mean that the parents pay, not the children, and so the wrong people are being penalised. In 2022, it was found that parents spent £780 on average on teaching their children to drive in the preceding 12 months. I am not going to argue with the algorithms that the insurance industry uses to calculate the price of insurance. We should just assume that they are right and that companies are underwriting an extremely expensive risk. We should therefore be somewhat sympathetic to the challenges they face, particularly as 24% of fatal collisions involve people aged between 17 and 24.

Seventy-five per cent. of the young drivers who are killed are male and a male car driver aged between 17 and 24 is four times more likely to be killed or seriously injured than a car driver aged 25 or over. That is because it is not until someone is 25—this is particularly true for men—that the frontal cortex of the brain is fully developed. That is the part of the brain that deals with hazard perception and the consequences, and we have developed that over aeons. That is why young soldiers go to war: they are not as frightened of the consequences as older soldiers. That is one of the problems that we have with hazard perception, and it is just one of those things.

We therefore need solutions that will keep our young people alive and on the road. That is why last week I held a roundtable on insuring young drivers with industry representatives, helped by Aviva, the ABI, superbly represented by Robert Rams—I do not believe he is there anymore for some reason and that is a great shame—and other agencies such as the RAC and, most importantly, IAM RoadSmart.

We discussed all the possible options. One of the most important steps forward is an industry-supported training solution so that, once someone has passed their driving text, if they go on to further training, they will get cheaper insurance because the insurance industry recognises that they are likely to be a more responsible and careful driver. The argument that came back was, “Well, that’s a self-selecting group of people.” Yes, it is, and those are the guys we want out on the road—the ones who want to be extra careful and extra well-trained. That is something we should really pay attention to.

In Australia, learner drivers are 20% less likely to be killed or seriously injured. That is because Australia does several things differently. First, people can apply for a provisional driving licence at 16 and a half, but they have to drive for 120 hours before they take their test—so they start earlier, but test later. The average in the UK is only 40 hours. Australia has seen that 20% reduction because of that rule. One of the other really simple things Australia does is not allow more than one passenger. Young people can cope with one voice gassing in the back of the car, but if there are loads of them—I think we all remember packing people into the car and popping down to the pub, or whatever, from our younger days—all that noise is bad for the decision-making process that young men’s brains go through when they perceive a hazard.

Having one passenger makes another difference to the insurance industry: on a rather dark note, it means that if there is an accident, fewer people are involved, and therefore the cost of the life-changing injuries mentioned by the hon. Member for Upper Bann is reduced. We can all do something about that right now. As our children grow up and ask if they can take people with them in cars, the advice should be, “Not until you’re a bit older—not until you’ve got more experience on the road. Please don’t fill your car with passengers. Just take one.” That is something we could do today that would not cost anything and would save lives.

Between 2012 and 2021, there was a 260% increase in the number of casualties related to driving under the influence of drugs. Some 32% of young drivers responding to an IAM RoadSmart survey said that they thought illegal drug driving was more common than driving under the influence of alcohol. So we are also dealing with changes in young people’s perception, the risks they are taking, and the risks they are tackling in their everyday lives. The solution is training courses. Training courses can teach them about driving under the influence and other topics relevant to them.

Safer roads are not just about young drivers—we need increased training for all ages. One effective measure we could take today is changing the rules on speed awareness courses. I do not know if any Members present have transgressed sufficiently to do a speed awareness course—I confess that I have, and they are brilliant. They remind us of our responsibilities and the value of education. Why are we not doing that for people who speed every year? Why restrict it to every three years? If it works, which it does, we should do more of it. It may not be as beneficial, but it is a really good way of improving the standard of all of us on the roads, which in turn makes it harder for young drivers to have accidents.

The Australians also introduced a graduate driver’s licence. People do not just pass their test and go straight on to the road; they have a graduated procedure. I am not sure that is as valuable. One of the things they insist on is a curfew so that young drivers do not drive between 11 o’clock at night and 6 o’clock in the morning. However, most young drivers in the countryside need to drive at that time of day because that is when there is absolutely no public transport, so I am not sure how well that would work; but again, they are much more likely to have an accident at night. In 2019, 37% of young driver fatalities and serious injuries occurred between 9 pm and 6 am, so they are more risk at night.

The one thing that would be easy for the Government to do is lift insurance tax for drivers that display the green P, so that if someone displays the green P on their car, they do not have to pay it. That would not cost the Government a great deal because they would make huge savings from the amount the NHS currently spends on patching people up, and the figures for people killed or seriously injured on the roads would be much lower.

Just lifting that tax burden on those young drivers, as long as they display their green P, would deliver a huge improvement in the cost of insurance and would save the Government a lot of money. Furthermore, it would make the rest of us who are driving more aware of the people most likely to cause an accident—perhaps in front us—in a car. That measure would turn the green P from a badge of shame to a badge of honour, and it would help with the cost to the parents of young drivers.

Data is vital to this issue, and I urge the Government to stop using catch-all data, such as “17 to 25-year-olds.” We need to collect data on 17-year-olds, 18-year-olds, 19-year-olds and so on. If insurance companies want to avoid claims, and young people want to be able to afford to drive, we need to do everything we can to make the model work better. Although we are all happy with what is going on, we are not happy with the net result—young people being prevented from driving legally and safely because their insurance is not just double the price of the car; it can be four times the price of the car. I hope that the debate will prompt the Government to act, and lead to solutions for all of us, but training certainly helps.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Transport (Anthony Browne)]

It is a pleasure to serve under you today, Mrs Latham. I want to thank the hon. Member for Upper Bann (Carla Lockhart) for bringing this important debate to the House. Hon. Members may have noticed that I am not the roads Minister, but I am here because the Under-Secretary of State for Transport, my hon. Friend the Member for Hexham (Guy Opperman), has to appear in the Adjournment debate. I was only asked to do this a couple of hours ago, so I am a last-minute stand-in for an area that is not in my brief. I ask hon. Members to forgive me if I do not answer every question here, but I will make sure that the questions are answered afterwards.

The debate focuses on an important issue. The hon. Member for Sefton Central (Bill Esterson) and I must be the same age, as I too passed my driving test aged 17, 40 years ago. I was very keen to drive as quickly as possible, for all the freedom it gave me growing up in Cambridgeshire. I have two teenage children who I am currently encouraging to learn to drive, so I am aware of all the things that various hon. Members mentioned as regards the difficulties of young people driving.

Obviously, as a parent, I am incredibly concerned about safety and very aware of the costs of insurance. I and the Government are big supporters of helping young people to be able to drive and to do so in as safe a way as possible. It really should not need saying that every single death on the road is an absolute tragedy, and even more so for somebody who is at the start of their life. We need to do everything we can to prevent that.

The Government will continuously strive to improve road safety, but overall we have a good record in the UK. I used to do quite a lot of work on road safety in the 1980s; there were around 5,000 or 6,000 deaths a year back then. Now, it is around 1,500 deaths a year. Each one is a tragedy, but that is a dramatic fall. We now have the third safest roads in Europe, with only Norway and Sweden having safer roads, but clearly we still need to do more because every death is a tragedy.

As various colleagues have mentioned, young drivers are a particular risk. Young drivers between the ages of 17 and 24 account for 6% of driving licence holders but were involved in 28% of fatal and serious collisions in 2022. However, like the headline figures, the number of car fatalities involving 17 to 24-year-olds on Britain’s roads is also falling. We have seen a drop in the number of 17 to 24-year-olds killed—from 448 in 1990, to 158 in 2010, to 101 in 2022. That is a 77% total decrease since 1990: a very significant drop.

I will try to address all the issues raised here as far as I can, but many are not for my Department, but for others. Indeed, many are also devolved issues and not for the UK Government but rather for the devolved Administrations. I will, however, endeavour to cover all the points raised.

Pretty much everyone who spoke raised the issue of car insurance. I pay car insurance and have noticed the dramatic increase. I was really quite shocked and, indeed, annoyed by it, so I am well aware of the dramatic rises. Various hon. Members have rehearsed the different arguments for it, but it is really quite shocking. As the Minister responsible for the decarbonisation of transport, I speak a lot to car companies, particularly about electric vehicles. The insurance there is also very high, so I have summoned a roundtable of insurers to talk about that in the coming weeks.

I have also heard from car manufacturers about insurance. Some hon. Members mentioned that insurance is £3,000, but we can multiply that by 10 for some cars, and I know that that is affecting car sales. In other words, the insurance is so high that people are not buying cars. The issue, therefore, not only affects young drivers, where it is clearly significant, but is across the piece.

Insurance operates in a free market that is not run by the Government. We have a strong regulatory regime in place and it needs to work to ensure markets work fairly and in the interests of consumers. The Government do not prescribe the terms, conditions or prices that insurance companies set when offering motor insurance—it is not a state-controlled market—and we do not intervene in the decisions of insurance companies when determining whether to provide cover. Indeed, direct Government interventions in a market of that nature could damage competition overall. It is therefore for insurance companies to decide the level of risk in issuing any policy to a given applicant.

As hon. Members know, insurers use a range of criteria to assess the potential risk a driver poses, including their age, the type of vehicle being insured, the postal area where they live, and their driving experience and record. They set their own premiums, and it is a commercial decision for them based on their underwriting experience. The Government do not intervene or seek to control that market, and nor should they. That said, my officials regularly engage with representatives of the motor insurance industry on a number of matters, including the rise in premiums—we have addressed that with the insurance industry.

The Financial Conduct Authority is the independent regulator responsible for regulating and supervising the financial services industry, including insurers. I have spent a lot of my career working with the Financial Conduct Authority, and I can say that it has a wide range of strong powers to intervene in markets that are not working well, and it has a statutory duty to ensure that markets work well in the interests of consumers. It has a broad range of supervision, enforcement and competition powers, including the power to undertake market studies where it thinks markets are not working well and to see whether they can work better.

If there are particular interventions that should be made, the FCA can refer markets to the Competition and Markets Authority, and that is the proper way of doing things. It is not my role as a Government Minister to try to instruct an independent regulator on how to appear, but I am sure that it is listening, and I know many people in various aspects of the industry are writing to the FCA to urge it to look at the insurance market. It is an independent regulator, and it is not my job as a Minister to tell it how to use its powers to meet those objectives.

The FCA has recently taken several measures to improve the fair value of insurance products for consumers, including reforms across the motor and home insurance markets. As hon. Members have said, on 1 January 2022 the FCA introduced new rules that require firms to offer a renewal price that is no greater than the equivalent new business price that the firm would offer a new customer. That is to stop the loyalty penalty, where loyal customers end up paying more than new customers, which was deeply frustrating and has now been banned. The FCA estimates that those new rules will improve competition and save consumers £3.7 billion over 10 years. Under FCA rules, firms are required to ensure that their products offer fair value—that is, the price the consumer pays for a product or service must be reasonable compared to the overall benefits they can expect to receive. The FCA has been clear that it will monitor firms to ensure that they provide products that are fair value and that, when necessary, it will take action.

It is important to highlight, as some hon. Members have, that young drivers are generally less experienced and, sadly, more likely to be involved in collisions. They subsequently carry a higher risk with insurers when they seek motor insurance and, as a result, often pay higher premiums. To counter that, some insurers have introduced the use of telematics or in-car black boxes to allow better risk-based pricing of insurance, especially for new drivers. As hon. Members have said, many new drivers are safe drivers but are being punished with higher premiums because of those new drivers who are not quite so safe. If an individual has a real-time data feed, it allows the insurer to assess their driving behaviour, and that has not been possible in the past. The use of this new technology can help reduce insurance premiums if drivers show good driving behaviour with a black box installed in their cars.

[Sir Bill Wiggin]

That is a lovely idea that the insurance industry has put out there. However, if it is for someone’s children, it makes absolutely no difference because until the insurers have gathered the data on the driver, they do not reduce the premium. It is an after-the-horse-has-bolted solution and does not really fit the problem.

[Anthony Browne]

I thank my hon. Friend for that intervention. Clearly, it takes time for the insurer to gather the data and to give the benefit, but this can be useful in reducing premiums for certain young drivers.

Different insurers obviously take different views of their relevant factors in determining the price for insurance, and the motor insurance market is very competitive. As we all know, if we look online we will get many hundreds of different quotes. The message from the Government is that consumers should shop around to find the best products. Certainly, when I have renewed insurance and shopped around, I have found dramatically different quotes. It is quite surprising for a competitive market to see how different the quotes are—it is really worth doing. The British Insurance Brokers’ Association runs a not-for-profit “find a broker” service if someone wants a broker rather than going directly online. It specialises in finding cover for those who have difficulties obtaining the cover they need at a reasonable cost.

Several hon. Members mentioned broader support for young drivers. As I said at the beginning, the Government are supportive of young drivers. For new and novice drivers, the Department’s broad aim is to improve road safety through new technology and research, and, particularly for young drivers, through developing better learning opportunities and targeted educational messaging, while reinforcing vital behaviour change road safety messages through our THINK! campaign.

The THINK! campaign aims to reduce the number of people killed and seriously injured on the roads in England and Wales by changing attitudes and behaviours among those at most risk. It has an annual media spend of over £3 million, with recent campaigns on drink-driving, speeding and mobile-phone use. The primary audience for the campaigns is male drivers aged 17 to 24, who are at a higher risk and are four times more likely to be killed or seriously injured than drivers over the age of 25.

Several Members—including the hon. Member for North Shropshire (Helen Morgan), who is no longer in her place, and the shadow Minister, the hon. Member for Sefton Central—mentioned driving test waiting times. Indeed, the hon. Member for Upper Bann also mentioned that. I should say that Northern Ireland driving testing is a devolved issue, so that is up to the Northern Ireland Government—and now that there is one in Northern Ireland, I suggest that the hon. Lady raises that matter with the Northern Irish Government.

For England, Wales and Scotland, the Driver and Vehicle Standards Agency priority has been to reduce car practical-test waiting times while upholding road safety standards. The DVSA has deployed all eligible managers and administrative staff back on to the frontline for driving tests until the end of March. That will create around 150,000 new test slots. The measures put in place to reduce waiting times for customers, together with the ongoing recruitment of driving examiners, are creating, on average, more than 48,000 extra car test slots each month. As of 12 February 2024, there were 523,353 car practical driving tests booked—that is a very precise number—and 128,360 available within the 24-week booking window.

Several Members, including the hon. Member for Upper Bann, mentioned graduated driving licences. Indeed, the hon. Member for Paisley and Renfrewshire North (Gavin Newlands) sang their praises as well. Again, I should say that driving licensing is a devolved matter in Northern Ireland, as has been recognised, so, again, Members with particular issues or concerns about that in Northern Ireland should speak to the Northern Ireland Government.

In Great Britain, the Department for Transport keeps driving licensing requirements under review, but there are not any plans, at the moment, to introduce any further restrictions on younger drivers. We acknowledge that, in terms of population and the number of miles driven, 17 to 24-year-olds remain one of the highest fatality risk groups, especially males.

We do have a form of restricting novice drivers though the Road Traffic (New Drivers) Act 1995. On acquiring their first full licence, a new driver is on probation for two years. During that time, they are subject to a limit of six penalty points received for any driving offences, which includes any that they received during their learning stage. If six or more points are received, a driver’s licence is revoked and they must apply again for a provisional licence, re-entering the learning stage and going back to square one.

In the road safety statement 2019, action 8 was to

“Commission research to explore the potential of a Graduated Learner Scheme”.

That research was delayed due to the pandemic, but we look forward to receiving the findings of that in due course. Action 9 was to

“Commission research to explore the social and economic consequences of introducing Graduated Driving Licence”,

which is different from the graduated learner schemes. That research was not taken forward, but we are aware of the TRL report for the RAC Foundation and the Rees Jeffreys Road Fund, “Supporting New Drivers in Great Britain”, which was published in October 2022. In that report, eight areas of concern were considered, including potential impacts on access to employment and education, and on those in rural areas.

My Department has commissioned the £2 million Driver2020 research project to examine interventions designed to help learner and newly qualified drivers improve their skills and safety. The project includes looking at the effectiveness of telematics, the use of a logbook, extra hazard perception, classroom-based education, and mentoring agreements. We look forward to receiving the findings from that project, which will feed into considerations of further measures that we could take to improve road safety for young drivers.

Once again, I thank the hon. Member for Upper Bann for securing this debate on such an important matter. I hope that hon. Members are all reassured that Government are committed to supporting all road users and to improving the safety of our roads. That includes young drivers, who, as I mentioned, are involved in far too many crashes.