CAR SCHEME FOR THE DISABLED PAYS BOSS £1.7MILLION

MPs question Motability’s lavish salaries – and its £2.4BILLION cash stockpile

A COMPANY providing taxpayer-funded cars for the disabled is hoarding £2.4billion – and paying its boss £1.7million a year.

The cash ‘surplus’ has been run up by Motability, a charitable scheme run by chief executive Mike Betts. Thanks to bonuses, incentives and pension payments, he pocketed 11 times as much as the Prime Minister in 2017, a Daily Mail investigation reveals.

The firm offers a fleet of vehicles to wheelchair users and others in return for part of their State disability allowance. If it handed the £2.4billion to the Treasury it could fund 68,000 police officers for a year, the building of two hospitals and also cover prostate cancer research for a decade.

MPs last night called for an inquiry and demanded the money be returned.

A Motability insider admitted last night there was ‘nervousness’ within the company about its cash

reserves and it feared it was ‘only a matter of time before the Treasury notices and makes a bid to claw the money back’.

John Mann, a Labour member of the Commons Treasury committee, said the cash hoard was scandalous.

‘It is outrageous – money for old rope,’ he added. ‘They have a monopoly, it is the simplest of schemes, with no risks involved. This money should immediately be returned to the Treasury and used to help the disabled.

‘I shall be tabling an urgent question in the House of Commons.’

Nigel Mills, who sits on the Commons public accounts committee, called for an inquiry. ‘No charity arm should be hoarding that kind of money,’ said the Tory MP.

‘It is effectively public money, and it is completely unjustified that a charitable service for the disabled – with a guaranteed income from benefits claimants – has got so much surplus.

‘Fundamentally, if the service is not costing that much, then they should not be charging that much. They could charge disabled people less for cars. Paying the directors hefty wages 11 times what the Prime Minister gets is outrageous.’

The Motability scheme was set up in 1977 help disabled people get around by leasing a car, scooter or powered wheelchair.

Customers agree to their £58-a-week mobility benefits being paid directly to the company, which hands them a new vehicle. Insurance, tax, servicing, breakdown cover and replacement windscreens and tyres are included.

Around £2billion a year is paid directly from the Department for Work and Pensions to Motability Operations Ltd.

It is a charitable scheme, while also effec- tively being a private firm with a monopoly. Its VAT exemption means other firms would not be able to compete.

Analysis of the company’s accounts shows that an average of about £200million a year goes unspent.

This surplus has been building up for years – with the firm arguing it needs a big cushion against the risk of changes in car prices and inflation among other facto tors. The National Audit Office has not examined Motability since 1996 when it said its reserves of only £61million exceeded the necessary margin of safety.

Motability argues it is not a monopoly because it is up to disabled people how they spend their benefits, and two in three choose transportation options other than a Motability car.

Declan O’Mahony, director of the Motabilty charity, said: ‘Economists and lawyers have many different definitions of “monopoly” and it is probably better if we do not get hung up on the word itself.’

He insisted the firm needed to keep all the £2.4billion surplus, saying it was ‘appropriate and proportionate’.

But Labour peer Lord Rooker said the cash hoard should go straight to the Treasury. ‘They do provide an absolutely first-class service to people who need mobility,’ he said.

‘However there is nothing entrepreneurial about it. There is no risk, for them, in what they are doing. They are not fighting daggers-drawn in the market, because it is a monopoly. The whole system is built on benefits money for the disabled.

‘I have never come across such fat-cat salaries in what is supposedly a charity scheme. There is something not right about all this. The Charity Commission needs to look into it.’

In a statement, Motability said it was ‘apples and oranges’ to compare its current reserves with those from 1996. Since then, it has taken on responsibility for the value of used cars. And it said changes to motor insurance between 2013 and 2016 had also increased its risks, with cyber security another factor.

The Motability company operates under contract to the Motability charity.