Virtuous Britain: spending on prostitutes and drugs is down

Study of where our money goes when we open our wallets reveals people are splashing out less on ‘vice’

THE nation is becoming more virtuous, official data suggest, as spending on “vices” such as prostitutes and drugs has fallen by nearly a fifth over the past decade.

Data published yesterday by the Office for National Statistics (ONS) revealed the total amount being spent on prostitutes fell for the first time in nearly 10 years in 2016, down by 4 per cent from £5billion in 2015 to £4.8billion.

There was also a 40 per cent decline in the total amount spent on drugs over the five years between 2011 and 2016, the data showed.

The sharp fall comes after it was reported that the street price of popular drugs including cocaine had reduced, meaning the smaller spend may be down to cheaper prices as well as fewer people buying illicit substances.

Despite the fall in spending on sex and drugs, the total “vice” spend remains higher than spending on some legitimate hobbies, including gardening and cycling. It is the first time the ONS has calculated the amount of money households are collectively spending on illegal activities.

Prof Diane Coyle, of Cambridge University, said that although there was widespread debate about how best to measure economies, it was valid to include spending on drugs and prostitutes. “One of the functions of measuring the economy is to think about the scale of market activity as a whole,” she said.

“[That includes] all kinds of non-legal activity. However, we also use GDP [and spending] as a rule of thumb of measure of well-being as a whole. We don’t think that these things [drugs and prostitution] add to wellbeing.”

The ONS used a wide range of goods and services to measure how different parts of the UK spend money – ranging from housing costs to saving levels.

On average, Londoners spent £24,545 in 2016, more than anywhere else in the country and nearly £10,000 more than the average spender in the West Midlands, at £15,276. However, Londoners are not spending their money on having a good time. They spend less than other regions on recreation and cultural activities, partly, the ONS believes, because they face the highest housing costs in the country.

People in Northern Ireland spend more on tobacco than the rest of the UK, while households in Yorkshire and the Humber spend the least on clothing and food.

Scotland spent most on alcohol at £392 million, followed by the North West and South East, which spent £373million and £360million respectively.

On average, spending across the UK rose by 3.5 per cent from 2015 to 2016. Northern Ireland was the only region in which it fell, by 0.4 per cent.

The biggest rise in spending was in the North East, where it climbed 8.1 per cent, followed by the North West, up 4.9 per cent. The South East and Wales saw people part with 3.7 per cent more cash in 2016, than the year before.

Londoners and those in the West Midlands squirrelled away 14.5 per cent and 12.8 per cent of their income respectively into savings, well above the UK average of 6.9 per cent. The South West was bottom of the savings league table with just 1.5 per cent of income put away for a rainy day, followed by Northern Ireland at 2.5 per cent.

The ONS innovation drive includes plans to use anonymised credit and debit card data in future analyses of household spending. This follows other innovations such as adding vast online spending data to measure the “Amazon effect” on prices.