Interesting read (whether I agree on 45% cheaper is open to debate), but the link gives a prime example of Motability, the way it works and why, it would be difficult for anyone to offer competition. https://publications.parliament.uk/pa/cm201719/cmselect/cmworpen/847/84705.htm
Not only is the 45% questionable at best (I’ve seen quotes for cars on the scheme for similar to scheme prices including insurance, recovery and maintenance) especially where the discounts given to Motability weren’t particularly attractive.
They are also misrepresenting the VAT exemption, they are claiming it’s for all qualifying claimants, whereas we know from other’s experience that the given requirement away from the scheme is substantial and permanent adaptations. I do wonder if this is a mistake from the Chief Exec, or whether Motability have been allowed to bend the rules to allow all customers to have the VAT benefits, I’m guessing the former. to open up to competition, other companies would have to be allowed the same VAT benefits as Motability which is highly unlikely given the current situation.
The Salaries are in line for non profits with similar turnover. Trying to align the CEO’s salary with a dealership is imbalanced as there’s no dealership with 880,000 customers leasing cars every 3 years.
As I’ve said elsewhere, I’ve issues with how little Motability corrected the record while the British Media and organisations like Reform were busy spreading the impression of “free cars” for being disabled and high rates of fraud. I have the same issue with the DWP who could easily have given current or recent fraud rates for PIP which in 2024 were 0%. The complete and abject refusal to respond has left the Chancellor room to appear populist and target the scheme or, more accurately, disabled people as a source for income for the exchequer. The lack of response is also directly responsible for the removal of those brands despite them making better financial sense for Motability themselves.
Again, as said many times, while we are being painted in an incredibly dark light for having “free cars”, nobody is looking at the fact that anybody can get a new car for between 2 and 5 years with up to 45% paid by the same Chancellor. The Salary Sacrifice scheme allows any PAYE employee who will still earn above minimum wage after the salary deduction to lease a car with no credit check. That employee will then have that amount taken out of their Gross salary and then tax and NI will be calculated on the remainder. This allows people to save their tax rate off the monthly payments, so a person earning £20,000 could have a car with a £300 lease payment but only lose £240 out of their pay. Someone earning £200,000 could have a car with a £2,000 monthly lease payment and only pay £1,100 while the tax man picks up the other £900. If the country is actually so desperate for adding more money into the coffers, surely this is a better target and can reap much bigger rewards than the VAT on APs and IPT that we’re expected to find from July.
I'm Autistic, if I say something you find offensive, please let me know, I can guarantee it was unintentional.
I'll try to give my honest opinion but am always open to learning.
Mark