A comprehensive view of Welsh consumers from Which?'s consumer insight tracker and other data sources.
During my time at Which? I’ve quickly recognised that one of our greatest strengths is understanding what consumers want and need. They are at the heart of everything we do and we’re constantly striving for change in the areas where we feel that people deserve better.
Our Consumer Insight reports are a really important step in demonstrating our knowledge base and our understanding of consumers across the UK. For the first time we’ve produced 12 reports covering Wales, Scotland, Northern Ireland and the nine regions of England which highlight the spending habits, optimism, trust and worry of consumers in these areas.
This is a unique body of work, the first of its kind, which has allowed us to compare trends across the UK. As a result of these reports, we know that more people in Yorkshire and the Humber were satisfied with their household income (55%) than the UK average (50%); we also know that more Londoners felt financially squeezed (32%), compared to 27% on average in the UK.
These reports also highlight how the insights we gain from consumers can inform our campaigning. The statistics about connectivity and rail show us the problems people face in different areas of the country, and so it’s no coincidence that we also have major campaigns on these issues to try and make things better for consumers.
This work has been done against a backdrop of potential change with the uncertainty around Brexit a likely influence on political, social and economic landscapes. This may be particularly prominent in Northern Ireland and could have filtered into consumers’ financial perceptions, spending expectations and their level of trust in certain industries.
In 2018, greater transport powers were devolved from Whitehall to some parts of the UK, resulting in the creation of Transport for Wales, which now which now manages rail services across Wales and West England. At the regional level, this devolution led to the establishment of Transport for the North, England's first sub-national Transport Body, empowered to drive strategic transport improvements. Last year the Scottish government also placed greater focus on consumer need, launching a consultation on the establishment of a new consumer body for Scotland in July.
We continue to build on our insights to deepen our understanding of what consumers want and need, to allow us to prioritise the areas that matter most to them. As well as being fundamental to our understanding of consumer behaviours and feelings, the insights are valuable to all organisations working across the UK who have the power to make things better for their customers. So they are an important tool for our members, supporters, policy makers and businesses alike.
This set of reports are a fine example of how our mission to make consumers more powerful drives everything we do – and always will.
Which? is the largest consumer organisation in the UK with more than 1.3 million members and supporters, over 57,000 of whom live in Wales. We exist to provide consumers with the knowledge and support they need to feel as powerful as the organisations that they deal with in their daily lives. We seek to achieve change in two ways: first, through running campaigns that make people's lives fairer, simpler and safer, and second, by providing information and advice that empowers people to understand how to achieve the best value from the most reliable products and services.
Populus, on behalf of Which?, has conducted bi-monthly surveys of more than 2,000 consumers per survey across the UK since 2012 to gauge perception of and attitudes to the consumer landscape, known as the Consumer Insight Tracker. These data are weighted to be demographically representative of the UK population, and are published on consumerinsight.which.co.uk. To understand the key consumer attitudes in 2018, Which? has boosted these data to a minimum of 1,000 representative consumers in each region and nation of the UK. This report is based on a sample of 1,005 respondents from Wales.
We have supplemented our own data with figures from other organisations to present a more comprehensive comparison between the trends identified in our Consumer Tracker data and the facts around earnings, economic growth and unemployment. In this report, we have made use of data from the Office of National Statistics (ONS), Economic Statistics Centre of Excellence (ESCoE), the Resolution Foundation, UK Finance and the Office of Rail and Road (ORR).
This year for the first time, Which? has published research seeking to unpick trends in the optimism, trust and worry demonstrated by Welsh consumers. This report offers a snapshot of how Welsh people feel about their financial future and the trust they have in public services and vital industries like rail and broadband.
Our headline findings suggest that the majority (68%) of people living in Wales were satisfied with their household’s standard of living, with 49% of respondents saying that they were in a good financial position. However more than a fifth (21%) felt that their financial situation was poor. In terms of outlook for the year ahead, a quarter (26%) of Welsh people were worried that their finances would worsen, compared with 22% who expected they would improve. These figures therefore suggest that although most Welsh consumers were broadly comfortable, opinion was split fairly evenly between those who thought their position would deteriorate and those who predicted that their finances would improve. They also demonstrate that fewer consumers in Wales were optimistic about their financial futures than the UK average, where 26% of respondents expected to be in a better position in a year.
We have broken down our statistics on satisfaction by age, which revealed that far more over 65s were satisfied with their income (67%) than the Welsh population as a whole (49%). This more frequent contentedness among over 65s is mirrored across the UK, where 65% said they were happy with their income. Significantly more over 65s were content with their standard of living than those aged 30-49 (79% to 56% respectively); the least satisfied demographic. Across the UK, 82% of over 65s were satisfied with their standard of living. These figures suggest that across Wales and the UK, age is a key contributor to satisfaction with financial position.
Our research also examined how Welsh consumers felt about the UK economy as a whole, with 42% responding that the UK economy was in poor condition, while half of respondents (50%) predicted that it would get worse in the year ahead. This illustrates a disparity in outlook between personal and national finances in Wales, which suggests that people do not necessarily equate a deteriorating national economy with an impact on their household finances, despite the impact that this might have.
Which? also mapped how and where consumers were expecting their spending to change in the next 12 months. Unsurprisingly, discretionary expenditure on socialising and alcohol came out as the most likely areas where people expected to spend less (25% and 20% respectively), while 33% believed that they would end up paying more for their gas and electricity. Once again, these spending intentions mirror those of the average UK consumer.
Trust in essential industries was also surveyed across the Welsh population, with findings showing that most consumers trust the water industry to act in their interests. Indeed, 65% of Welsh consumers said they trust the water industry, compared with 57% in England, which had the lowest trust in water across the UK. At the other end of the scale, just 7% of consumers in Wales said they trust car dealers, closely followed by estate and lettings agents, who enjoyed the trust of just 10%.
Lastly, there were clear trends when it came to identifying consumer worry in Wales. Overall, 67% of consumers in Wales said that they were concerned about daily essentials like energy and fuel prices and public spending cuts. At the other end of the scale, 27% of respondents were worried about the price of their house falling which, although a smaller figure, still represents a significant minority of concerned households that is worthy of acknowledgement.
Across our Consumer Insight Report for Wales, we have found a great degree of similarity between the perceptions and outlooks held by Welsh and UK consumers. Using data from the ONS and ESCoE (Economic Statistics Centre of Excellence), we can establish a baseline understanding of the Welsh economy as a foundation for our analysis.
The unemployment figure in Wales at the end of 2018 was similar to that in the UK: 4.1% to 4% respectively. However, Wales reported the slowest growth of all the nations and regions (0.8% for 2018 compared to 1.4% for the UK). This suggests that although the Welsh economy is growing and unemployment falling, it is still lagging behind broader UK performance.
Half (49%) of consumers in Wales felt that they were in a good financial position, a figure matching that of the average UK consumer. However, this optimism was not reflected in Welsh perceptions of the UK’s financial situation, with two fifths (42%) saying that they would describe the state of the UK economy as poor.
Net figures, calculated by subtracting the statistic of those who thought their finances would get worse from those who thought it would get better, suggest that more Welsh consumers were pessimistic about their finances in the coming year, at a figure of -4% compared with +1% of the UK.
In terms of identifying trends of opinion for the year ahead, the proportion of people in Wales who thought their finances would improve was slightly lower than the UK average (22% and 26% respectively). Meanwhile, 50% of Welsh consumers thought that the state of the UK economy would get worse in 2019, compared to the far fewer 26% who demonstrated the same pessimism for their own household’s finances. This suggests that people do not necessarily associate a deteriorating national economy with a negative impact on their household finances, despite the impact that this might have.
Note: Does not sum to 100% due to the exclusion of ‘neither’ and ‘don’t know’
Examining the spending habits of people in Wales is an important step in understanding consumer priorities. In this section, Which? has analysed ONS Living Costs and Food Surveys for 2015/16 and 2016/17, along with ONS data on relative regional consumer price levels of goods and services for 2016, in order to assess costs and spending in Wales.
These statistics reveal that consumer expenditure in Wales averaged £551 a week, well below the UK average figure of £647, although prices on goods, services and rental and housing were on average just 1.9% cheaper. ONS data show that employees in Wales were earning less than the average for the UK (£22,088 compared to £24,006), which would go some way to explaining lower spending levels.
Our analysis suggests that for Welsh households on average, around 28% of total expenditure was accounted for by housing, utilities and communication, while transport represented 14%, groceries, goods and services; 32% and recreation, 19%.
Household spending per week
Deeper analysis of the survey data, for which households kept a detailed diary of their spending over two weeks, allowed a more detailed assessment of spending. The figures below set out the percentage of households in Wales which bought a variety of commodities and services in an average week.
Proportions of households spending on selected items per week
The figures above suggest that consumers in Wales were just as likely as the average UK consumer to buy essential groceries like meat and vegetables. However, a smaller proportion were likely to spend on clothing and footwear and restaurant meals and takeaways, while it is slightly more likely that people were spending on tobacco.
In addition to analysing spending habits, we also set out to understand how likely consumers in Wales were to increase or decrease their expenditure on certain goods and services over the next few months. While the majority of respondents intended to keep their spending the same across essential outgoings like housing and transport, there were some clear trends in what Welsh people were expecting to be spending more/ less on in the months ahead.
The outgoings that the largest proportion of Welsh consumers expected to increase their spending on were: gas and electricity (33%), running their car (29%) and groceries (29%) – all essential expenses that match the trends demonstrated by consumers across the UK. The data also suggests that these increases could be at the expense of socialising, eating out and making big-ticket household purchases, both categories where at least a fifth of Welsh consumers said they would reduce spending.
Interestingly, the two areas where the largest proportion of consumers were likely to keep their spending the same were mobile phone payments (81%) and broadband (78%). The intention to maintain existing expenditure in these areas is mirrored by our UK-wide findings. This is likely because many people will be tied to a minimum contract period before they are able to switch telecoms provider, despite the fact that many could benefit from faster broadband speeds at a cheaper price if they switched to a different package.
We asked people how concerned, if at all, they were about key issues that we believe have the potential to impact consumers. We calculated an overall figure for worry by combining the statistics on the proportion of people who were either ‘fairly’ worried or ‘very’ worried about the issues outlined below.
Overall, our findings suggest that the top concerns for consumers in Wales were the costs of daily essentials like energy and fuel, along with the impact of public spending cuts, with seven in ten (67%) consumers citing these as areas of worry. Towards the other end of the scale, fewer respondents in Wales said they worry about more discretionary spending, in particular, the price of electrical goods (28%) and clothing (26%).
Interestingly, issues relating to personal finance sat in the middle of the range of figures on worry. For example, 55% of Welsh residents were worried about the value of their pension, while 46% were concerned about their mortgage rates. When breaking down this data by age, worry over household level of debt peaked in the 30-49 age group (46%), as did worry over mortgage levels (55%); a group where half (50%) have children under the age of 18.
Top 10 consumer worries in Wales
We asked people to set out the extent to which they trusted certain providers of public services to act in the best interest of the consumer/ recipient. The figures below show the proportions of people who said they ‘trust’ the providers of essential public services, from education to healthcare.
The range for this set of figures was large. The health service came out on top, with GPs, hospitals and the NHS all trusted by seven in ten Welsh consumers. However, this trust did not extend to the social care system, which placed comparatively very low, with just 26% of Welsh respondents claiming to trust social care providers to act in their best interests. Broadly, the same proportion of Welsh consumers trusted public services as the UK average, however Welsh consumers were the least likely to trust GPs across the four nations, as the table below suggests.
Percentage who trust the following:
When analysing further, the level of trust felt by consumers toward these public services changed based on age. The figure for those who trusted social care dropped to just 22% of people who were over 65, whilst 18-34 year olds were more likely to trust college (61%) and university (46%) than the average Welsh consumer. Within this younger demographic, 45% had achieved a qualification at university level or higher, compared to the Welsh average of 38%. This therefore implies that those who have experienced higher education first hand are more likely to trust these institutions.
In addition to understanding the perceptions of Welsh consumers about public services, we also sought to unpick their attitudes to certain sectors and industries, once again attempting to establish whether respondents trust these industries to act in their best interest.
The level of trust was varied across all of the sectors and industries that we surveyed opinion against. Water came out as the industry in which the largest proportion of consumers felt that their interests were well respected (65%). When it came to identifying industries with the lowest levels of trust, car dealers came out worst, with just 7% of Welsh consumers saying they trusted them, closely followed by estate and lettings agents who enjoyed the trust of just 10% of Welsh people.
Percentage who trust the following:
When compared to a UK average, it appears that more Welsh consumers trusted the water industry, the trust scores for which vary across the nations of the UK:
Percentage who trust the water industry:
Our findings around trust are interesting as they suggest that (in addition to other factors like price, level of industry regulation, and familiarity with the purchase process) consumers might be less trusting of transactions they make with industries where there is an imbalance of knowledge between the consumer and provider. For example, a car dealer is likely to know far more about the performance and value of a vehicle they are selling than the average consumer, just as an estate agent may know more about a property and the process of renting or buying a home. This is where Which? seeks to provide consumers with the information they need to deal more confidently in these transactions.
Identifying trends of financial difficulty is a key output from Which?’s Consumer Insight Tracker2. In our measure there are five signs of financial difficulty that we monitor, ranging from the least severe (cutting back only) through to the most severe (defaulting on a loan, bill, mortgage, or rent payment). As such, Which? asked people whether their households had experienced some form of financial squeeze within the past few months which might have necessitated them taking one of these actions, in order to reduce the pressure. We supplemented our own survey results with the findings of the Resolution Foundation’s ‘Low Pay Britain 2018’ report to add context of the extent to which respondents’ experience of squeeze forms part of a broader trend of financial difficulty in Wales.
Our results showed that more than a quarter (27%) of Welsh consumers were feeling squeezed, and of those, more than one in five defaulted on a loan, bill, mortgage or rent payment. When contextualising these findings with the Resolution Foundation’s report, a quarter (26%) of Welsh workers are earning less than the Living Wage3, compared with the UK wide figure of 23%.
When looking at how age influences financial pressure, Which? found that 35-54s were most likely (38%) to report feeling financially squeezed, compared with 27% across the whole Welsh population.
The figures below are taken from our Consumer Insight Tracker data on financial difficulty and demonstrate how those experiencing financial squeeze sought to reduce the pressure.
The Welsh figures for defaulting on a loan, bill, mortgage or rent and for taking a loan, credit card, overdraft or unsecured loan were statistically the same as those found for the UK as a whole, as was the proportion of people who we identified as being financially squeezed.
The 5 levels of financial difficulty
Note: These are proportions for those experiencing at least one form of financial difficulty, not overall prevalence.
2. The Financial Distress Index estimates the extent to which the households in an area are experiencing financial difficulty relative to all other areas. Areas are ranked out of 100, where 100 is most distressed and 1 is least, and these figures articulate how financially squeezed respondents are feeling.
Which? surveyed 14,138 people between January and December 2018 and asked them about their financial experiences. The most severe financial difficulty they had faced in the past month determined their 'Financial Squeeze' group.
Estimates of financial distress were then calculated for each 2011 Output Area Classification group, then extrapolated down to individual output areas. Averages at the higher level geographies were calculated and weighted by Census 2011 household population estimates.
Please note these statistics are estimates, and are not directly measured from the survey.
3. By Living Wage, we refer to the voluntary rate set by the Living Wage Foundation as a minimum standard to cover living costs rather than the government's compulsory 'National Living Wage’. At the time of writing, UK rates are £9/hr and £10.55/hr in London.
We used our Consumer Insight Tracker data on financial difficulty, together with the ONS’s 2011 Output Area Classification data to estimate the extent to which households in each constituency and region were experiencing financial squeeze relative to other areas. We also sought to understand whether the trends of financial strain could be better understood by examining the financial realities of people living in Wales, using the figures for median earnings provided by the ONS4 and personal loan data from UK Finance5. In Wales, the median figure for annual earnings was £22,088 compared with £24,006 for the UK as a whole, while the average proportion of personal loans to earnings was 4.8%, compared with 3.9%.
Our analysis shows that two of the constituencies with the highest median earnings (Monmouth and Gower) were also those where constituents were feeling the least financially squeezed. However, only one of the constituencies that ranks among the lowest earnings also appeared in the list of most squeezed constituencies (Rhondda). Interestingly, the two most-squeezed constituencies are located in Cardiff, the most densely populated city in Wales, while more rural constituencies like Preseli Pembrokeshire, despite a lower median earnings figure, reported lower levels of financial squeeze. This trend suggests that beyond earnings, the unique pressures associated with urban living (such as higher costs of goods and services) can exacerbate the symptoms of financial strain.
4. ONS ASHE annual gross earnings 2018 (interim)
5. UK Finance data on outstanding £ values of personal loans by postcode sector, aggregated into parliamentary constituencies, Q2, 2018
Which? campaigns consistently on a number of issues as part of our mission to uncover consumer detriment and push for positive change. As a result of our work, we can share insights into the unique experience of Welsh consumers with both their broadband coverage and the rail service.
As part of our Fix Bad Broadband campaign, we offer consumers a broadband speed-checker tool, inviting people to identify their service speed and enabling us to analyse the consumer experience of broadband connections across the UK.
The UK government has identified a download speed of 10Mbps as the minimum speed required to fully participate in digital society. The new broadband Universal Service Obligation (USO) will provide consumers with a legal right to request a broadband connection with a download speed of at least 10Mbps6. Ofcom has responsibility for implementing the USO, and it should be in place by 2020.
Ofcom’s broadband speed measures are the maximum possible at residential premises, with the data supplied to Ofcom by providers. Which?’s own data for 12,169 users of our speed-checker across Wales in 2018 shows that for those consumers, 40% of user tests fell short of the USO speed level. Data from our speed-checker suggests that in Welsh urban areas such as Cardiff, Newport and Swansea, broadband speeds were good on average. However, in predominantly rural areas such as Brecon and Radnorshire, Carmarthen East and Dinefwr, and Ceredigion, broadband connections were poor, with more than 50% of people using our speed-checker not achieving download speeds of 10Mbps.
The Welsh government has launched a range of initiatives designed to improve the broadband experience of consumers. Access Broadband Cymru provides financial assistance for individual connections and community support around connectivity, while the Welsh government’s Superfast Cymru has committed to invest more than £90 million to deliver 30 Mbps services to the nation.
Proportion of consumer broadband speed tests achieving 10Mbps or above
Which? publishes an annual Rail Satisfaction Survey, a poll that seeks consumer insight on a range of factors affecting their train travel, from punctuality to seat availability which contribute to an overall customer score7.
Of those train operating companies serving Wales, Arriva Trains Wales received a customer score of just 48%, compared to Great Western Railway’s 47% and Virgin Trains’ 57%. According to the Office of Rail and Road (ORR) for the period 2017-2018, Arriva Trains Rails carried out 32.9 million journeys, with a train cancellation rate of 2.8%, compared to Great Western’s cancellation rate of 3.9% and CrossCountry’s rate of 3.6%.
In addition to our Rail Satisfaction Survey, in 2018 Which? also undertook analysis of two months of rail regulator data and found that fewer than half of rail passengers were satisfied with how their complaints were dealt with by train companies. Of the train operating companies who provide services for Wales, 35% of respondents were satisfied with the way their complaint with Arriva Trains Wales was handled, with 43% satisfied with the outcome. This compares to companies offering cross-border services like Great Western Rail, where just 17% of all respondents who had complained about Great Western Rail (whether in Wales or beyond) were satisfied with how their complaint was handled and just a fifth (21%) were content with the outcome. The highest complaint satisfaction scores were achieved by CrossCountry, where 49% were content with how their complaint was handled and 47% with its outcome.
Both the cancellation rates set out by the ORR and our data on satisfaction with complaints handling explain how the rail industry still has some way to go in recognising passengers as consumers, as we called for in our super-complaint of 2015. This is why we will continue to champion improvements in consumer experience through our Train Pain campaign.
The year ahead will be particularly important for people using the Welsh rail network, as the newly established Transport for Wales seeks to improve the legacy left by its predecessor, Arriva Trains Wales. It appears that progress has already been made, with the introduction of Delay Repay 15, and further plans for Smart Ticketing to be rolled out across Wales and the Borders later this year.
To find out more, visit our Consumer Insight page at consumerinsight.which.co.uk, where you can access our latest research on a range of issues, and detailed data on consumer attitudes, perceptions and concerns broken down to the constituency level across the UK.
6. The minimum technical standard for connections made under the USO will be: minimum download speed of 10Mbps; minimum upload speed of 1Mbps; additional quality parameters: medium response times, a minimum data cap pf 100GB and a contention rate of 50:1 (ie a maximum of 50 users share one bandwidth)
7. The customer score is based on satisfaction with the brand and likelihood to recommend. Satisfaction and recommendation contribute 50% each to the overall customer score, and a respondent must answer both questions for their answers to contribute towards a customer score. For both satisfaction and recommendation, we apply a weighting to each response.