The UK’s Cycle to Work Initiative: A Proven Framework
Written by: Maxime Renson | October 27, 2025 | Time to read 6 min
The UK’s long-running Cycle to Work scheme proves that smart policy can change behavior.
More about the Author: Maxime Renson, General Manager at Upway
Graduated in engineering and business, I spent 6+ years at Uber across six countries before joining Upway’s founding team in 2022 to launch the U.S. business. Outside work, I bike, run, play golf and padel, and swim with my son.
Cycling advocates in the United Kingdom have been partying like it’s 1999 since, well, 1999 when the Cycle to Work scheme first rolled onto the scene. The long-standing program was introduced to promote healthier commutes and lower pollution, and the policy’s positive results have preserved strong support over the years. The latest data is in, which could inspire other countries like the US to adopt similar bike leasing initiatives to help power the e-Bike revolution.
What is the UK’s Cycle to Work scheme?
How the Cycle to Work program works
Employees pay for their bike via salary sacrifice each month, a pre-tax deduction from their payslip, over the course of 12 or 18 months. The exact amount depends on the overall price of the bike and lease length, but the payment can often be around £50-£100 per month.
At the end of the lease period, there are a few options. The most common— and financially beneficial one— is to enter a zero-cost ‘extended hire’ arrangement. Individuals opt to extend the lease and buy the bike at a later date. But what actually happens is that the value of the bike continues to depreciate until the bike’s value is negligible, automatically passing the ownership to the individual.
Encourages first-time cyclists
The latest 2025 evaluation of the Cycle to Work scheme found that “nearly 4 in 10 (39%) of scheme users were ‘newly commuting cyclists'”, meaning the program is encouraging people to take up cycling in a huge way. People were drawn to the program “equally to save money on a bicycle (43%), and to spread the cost of the bicycle (40%)”— everyone loves a good deal. And these positive trends, while larger than ever, aren’t new.
A 2016 study of the scheme reported that “9% of participants were non-cyclists who started cycling once they had joined the scheme”. The program has a long history of motivating first-time cyclists to start commuting to work by bike and ride for leisure. It goes to reaffirm that “there is additional evidence from other studies, including those of similar initiatives in Ireland and elsewhere, that the scheme encouraged an increase in cycling among participants and particularly promoted non-cyclists to take up cycling.”
Cycle to Work helps participants cycle more
Cycle to Work provides proven economic benefits
We often hear about the social or environmental benefits of cycling, but it can be difficult to pin those intangible— or better said, non-cash-based— benefits down in the economic sense. But the recently released analysis from Ortus does just that, breaking down the impact of the Cycle to Work scheme at a nearly molecular level, pound by pound.
The UK government earns more VAT from customer purchases on bikes, including £8.3 million that simply wouldn’t have happened without the scheme, in fact. Cyclists riding to work save £1,262 per year on commutes compared to driving. The aforementioned 2016 study discusses “evidence to suggest that such schemes could, for instance, result in reduced sickness absence, which would produce savings for employers.” And the Ortus research estimates it could “save their employers £63 per person per year through reduced sickness absence, plus £115 per person in productivity gains from improved attendance and consistency. Together, that’s £37 million a year back into the economy.”
In all, the social benefits from reduced absence and better physical fitness sum to more than twice the estimated cost to the UK Treasury from lost income tax from the Cycle to Work scheme. As far as public policy goes, that’s about the biggest thumbs up you can give a program.
As stated, the Cycle to Work scheme rakes in more than £573 million in economic benefits per year, fully justifying the UK government’s future plans to invest £616 million over the next four years on cycling infrastructure and related initiatives. Money talks and is an important factor in all policy decisions, and what the data is saying is music to cycling advocates’ ears. The Cycle to Work scheme has been proving its worth, and hopefully, it continues to encourage bicycle and e-Bike adoption all around the UK.
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Key Takeaways
- Pedal Power Pays Off: Participants can save up to 47% on a new bike or e-Bike through tax benefits and salary sacrifice.
- Cycling Converts: Nearly 4 in 10 users were first-time cycling commuters, showing the program’s power to change habits.
- Economic Engine: The scheme drives £573 million in annual benefits—boosting retail, health, and workplace productivity.
