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They will take an extra 10.1% of our money and give it to Motability the charity who will give it to whomever they want. Think if it as an extra tax!
I’d love to think it would be A and/or B, but we all know that the answer is C. It’s coming up to Christmas Bonus time at Motability Operations when the person I know who works there will be told how many thousand pounds it will be this year – all paid for from the benefits of disabled people. Shameful IMO.
PIP & DLA going up by 10.1%. What will happen with Motability?
Virtually nothing (if anything)!
Most of it has already been priced in to Motability’s 3 year leases and resultant AP’s.
Motability basically priced in this increase (well, at least 7.1% of it) when they released their Q3 price list on 1st October 2022.
How you could tell was that the differential pricing of vehicles on the scheme (at T/A) between DLA/PIP/AFIP etc and WPMS, which, over a projected 3-year lease widened from £1170 to £1253 (7.1%) from 1st October 2022.
The only time this gap widens is when Motability factor in and project forward the annual increase in the allowances used on the scheme, into their pricing (as WPMS is paid at a higher amount it goes up by more than the other benefits/allowances and thus the pricing differential widens).
In the past Motability usually factored this in on the Q1 prices, prior to the date of actual allowance increase in the April, but this year, they did it a quarter earlier.
There maybe some minor tinkering around with the residual 3% not yet factored in, probably for the Q1 2023 pricing, but that is relatively ‘in the noise’ as far as their customer facing prices are concerned with the relative cost of vehicles, salaries, insurance, tyres, servicing ‘et al’ increasing.
Well, my Mini goes back next month and that’s me finished with the scheme so they won’t be taking anymore off me.
BigDave, they may have factored in the rises for new contracts. But for those with existing leases it’s all bunce.
BigDave, they may have factored in the rises for new contracts. But for those with existing leases it’s all bunce.
Yes, I agree it applies to leases taken out on or after 1st October – hence referring to the pricing being changed from that date. – ie the AP and ongoing payments if taking out a lease from then.
Motability did confirm it to me when I pointed out to them that on their October list, they had priced some ‘fixed weekly payments’ vehicles on WPMS in excess of the current weekly WPMS allowance! They did re-price them and it has led to some very odd pricing!
Those already ‘on contract’ would have been ‘priced’ whenever they ordered their vehicles. If T/A then the increased ongoing leasing charge will be taken in April.
Just this year, Motability have ‘priced’ their vehicles somewhat earlier than usual and only by 7.1% (at the moment).
I think this will be my last vehicle on Motability. The scheme as it stands today no longer suits me.
As a charity surely they are obliged to pass the increase directly back to the customers?
otherwise it’s profiteering from tax payer cash.
what’s the point of giving benefits rises of 10% if the claimants don’t see the benefit?
I have always said Motability should return “excess” profits to its members. They have a system allowing good condition bonuses etc to be paid directly into members accounts. This would be more transparent than promising lower advance payments. Those who are not on a “full allowance ” contract will see the full benefit of the 10.1% increase, whilst those with a NIL AP but full allowance will not.
So, to cut a long story short. I got a motorbility lease in June 2022. Now will I get the increased benefit in April or will my motorbility be higher and they will take it? Many thanks in advance
So, to cut a long story short. I got a motorbility lease in June 2022. Now will I get the increased benefit in April or will my motorbility be higher and they will take it? Many thanks in advance
It depends if your vehicle is ‘Total Allowance’ or ‘Fixed Weekly Payments’ as stated in your Contract Hire Agreement (available in your online account):
If ‘Total Allowance’ the increase goes directly to Motability.
If ‘Fixed Weekly Payments’ you keep the increase over and above the fixed weekly lease amount.
I’m afraid EDC you are looking at the system wri=ong.
tgere are two parts of lease=ingca Motability car, the charity, which is responsible for administrating a scheme but it contracts to Motability Operations Ltd for the supply of lease vehicles and the company paid each month by the system for your lease.
Mitability Operations is not a charity, rather a PLC and is there to make a profit.
We’re seriously thinking of buying privately when current lease ends. We would use a mixture of finance and savings. Worked out the finance part would be £330 over 5 years, BUT we’d benefit from these yearly inflation increases that currently go straight to Motability.
I’m afraid EDC you are looking at the system wri=ong. tgere are two parts of lease=ingca Motability car, the charity, which is responsible for administrating a scheme but it contracts to Motability Operations Ltd for the supply of lease vehicles and the company paid each month by the system for your lease. Mitability Operations is not a charity, rather a PLC and is there to make a profit.
I’ve seen a few charities work in this way, a company designed to make profit as a direct subsidiary of the charity. However, in most cases all the charity senior management that are also on the Ltd Company’s board are paid by the charity. All profits from the company should also be ‘donated’ to the company. This maximises the income for the charity whilst taking advantage of VAT controls for income/expenditure.
The advantage Motability Ltd has is that it makes a huge number of purchases of assets that decrease in value. So, where most companies have to pay a VAT bill quarterly because they took their purchases and made a profit from selling them, Motability take money from Government but have a specific VAT exemption. Thus their purchase VAT can all be reclaimed less anything they receive in selling the cars.
This results in huge profits which should be donated to the charity who use a good chunk to make grants to those unable to pay the APs required to keep the profits up – thus generating it’s own cycle of money.
I’d love to have a look at the workings of their cash flow, I’m pretty sure there’s the odd twist in there to appear to be doing the right thing whilst ensuring the board are living well above the poverty line.
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
Hi JoJo in that £330 is your servicing, Adblu, insurance, tyre replacement, windscreen replacement included?
RogerWilko, have a look at Cazoo, £18 a month for an ongoing warranty. Service every couple of years £200 or less on an EV, Tesla don’t even have a service schedule, so then after 5 years we own a car worth £10,000 minimum. Tyres £400 every 3-4 years. Windscreen covered on most insurance policies.
Motability are quids in with these new rates. I would expect higher bonuses for the directors and staff will be on the cards.
Motability are quids in with these new rates. I would expect higher bonuses for the directors and staff will be on the cards.
I’m glad that you added “and staff”. Some people get fixated on what the CEO gets paid. Directors of all large companies have big salaries and benefits to reflect their vast responsibilities. That’s normal. Motability Operations is no different. Where Motability Operations are a complete outlier is in the total remuneration package offered to ALL their staff.
When all is said and done, they are a call centre. Most call centre staff elsewhere have tough sales targets to hit. The KPIs at Motability are very soft by comparison, yet their staff have an overall benefits package that 99% of employees these days can only dream of . What I struggle with is the fact that this exemplary package is paid for by disabled people sacrificing their benefits, rather than profits generated by purely commercial activities. This fact has never sat comfortably with me.
When all is said and done, they are a call centre. Most call centre staff elsewhere have tough sales targets to hit. The KPIs at Motability are very soft by comparison, yet their staff have an overall benefits package that 99% of employees these days can only dream of . What I struggle with is the fact that this exemplary package is paid for by disabled people sacrificing their benefits, rather than profits generated by purely commercial activities. This fact has never sat comfortably with me.
This together with the very high AP’s for an estate car and the fact we now have to pay for hand controls is the main reason we are leaving Motability after 30 years. We are not entitled to a grant and will need to fork out around £5k in ap, hand controls and a hoist. We’re going to make use of the VAT exemption for disabled on new cars and keep it.
I no longer think Motability is fit for purpose, especially if your disability requires adaptations and a large car and you are not entitled to a grant. It’s sad because this is what the scheme should be for.
Motability are quids in with these new rates. I would expect higher bonuses for the directors and staff will be on the cards.
Most certainly.
Whilst I stand by my previous comments, I’d still like to think that on 1st April Motability might announce an across the board reduction in all APs of £1,000 to reflect the extra benefit income that they are going to receive during the duration of every 3 year lease. We can live in hope.
I have been looking at the scheme since about 2007 when my son first got DLA. It seems there is only one long term trend on the scheme. A loss of choice and vastly increasing costs, way over inflation.
When I first looked at the scheme you could have almost anything you wanted if you were willing to pay the difference in the overall cost of ownership when it came time to hand it back. Somewhere along the line this changed to a “top of the range” hybrid Astra costing over £19,000 to rent for 3 years.
Before all the Guardian readers jump on with “you should be grateful for that…” and “you can go and buy what you want yourself if you’re not happy with one of those little three wheeled turquoise cars…”, my point is that the trend of the scheme over the long term is.. less choice, poorer value. It’s that simple.
I think that fact is undeniable, so the next question is… If this continues, how long can the scheme really last, 5 years, 10 at the outside? It cannot be unnoticed by those administering the scheme or by government, therefore this is being allowed to happen by political choice.
Which leads me to one conclusion, the Conservatives have already presided over many suicides due to stress and a corrupt assessment system which incentivised the processing company to refuse claims, even if they are subsequently granted on appeal. Now they systematically by incompetence, or malevolence, reduce the meager benefits of the disabled by restricting choice in this way on the scheme under their watch.
I say this as a Tory voter, but it cannot be ignored, or dismissed. To say this is a forum about the scheme and politics has no place here, I believe is wrong. Politics is about how our lives are run and this is an issue.
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