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Motability finances in the news......OBSCENE???
exdvr
Member Posts: 312 Pioneering
http://www.bbc.co.uk/news/business-44188363
"The Secretary of State has stated that Motability provides an extremely valuable service to disabled people but the levels of executive pay and financial reserves are concerning," a spokesperson for the Department for Work and Pensions added.
Surely questions have to be asked into why the chief executive earns £1.7 million per year and the business he controls has assets of £2.4 BILLION.
Best wishes.
DLTBGYD
Replies
Can they let us know please
Sort that out and yes i think disabled people would hold the dwp responsible for all the money they have wasted.
Money that should be used to help us drive and to keep ours cars on the road.
And that should include.people over 70. Disablity 1st not age
To the year September 2017 Motobility received £2.1 Billion in used car sales, just under half its annual income. The article referred to in the opening post states that the company has £2.4 in funds - not the same as assets as described by @exdvr So over time they have built up roughly six months of their annual revenue.
So to answer the question in the thread title is this obscene?
Considering just under 50% of the annual revenue is through second hand car sales a slump in this market would have a huge impact on their income and so represent the highest risk to the Motobility scheme. So in truth while £2.4 Billion sounds a lot of money it represents about 6 months income, giving them 12 months leeway if things go wrong with the second hand market.
Personally I would be more concerned if the money wasn't there or plans to at least build it up.
As an individual I stood alone.
As a member of a group I did things.
As part of a community I helped to create change!
Good point on the risk motability carries.
They have numerous bonds owing for future repayments, to the banks.
100s of millions pounds over next few years.
If you understand the lease car market, this is a non story.
Only a third of people who get enhanced mobility have a motability car.
Thats over 600,000 cars.
Around 1,220,000, do not use the motability scheme.
It all sounds big numbers and it is the largest lease scheme in Europe.
Hope this helps.
Best wishes.
DLTBGYD
Hamilton. Obscenity knows no bounds.
What a sad world we're living in.
Best wishes.
DLTBGYD
The article is clear his pay is based on the FTSE 250 and his wage is below the average, £1.8 Million. It is hardly excessive compared to others. That doesn't make the situation right morally, but with a turnover in excess of £4 Billion would you not want it in good hands? A lot is made of comparing salaries with what the Prime Minister is paid. I wonder how many of these well paid CEOs would remain in their jobs if their performance matched Theresa May.
Personally I find it interesting that this is where the focus is considering that the ATOS contract was recently extended, the farce on the contracts for helping people to get back to work, or the loss of money introducing the new system for UC.
As an individual I stood alone.
As a member of a group I did things.
As part of a community I helped to create change!
If the mobility component goes up they do not pocket the difference. First you have a choice of cars, you select one that is less than your mobility component you keep the difference. Similarly if the mobility component goes up of course they do not pocket the difference, for no other reason you have already entered into a contract with them and the payments are already set.
I am not sure what your second point is, the car alway belong to Motobility you are simply leasing it. Motobility has a responsibility to manage their assets and this including getting the best price for their vehicles, either through auction or through second hand dealership. It is always going to cost more to lease a car and then buy it at the end of the lease period than to buy a new car, as you say a non story.
As an individual I stood alone.
As a member of a group I did things.
As part of a community I helped to create change!
The money is given to the individual claimant to do with as they want, there are no restrictions on how it is spent. It is up to the individual if they want part or all of their mobility award on a car, mobility scooter or electric wheel chair. It is their choice not the government. It is not semantics it is a simple truth.
The fact that the money is directly paid from the source rather than an individual has some advantages for disabled people, for example the need for the individual to prove their income and get a credit check.
It is also untrue that they are unaccountable. The charity side would be held accountable to the charity commission as well as its members, while the business side would be accountable under the Companies Act 2016, as they provide leases they would also be accountable to the FSA and various consumer laws. And of course they are also responsible to their shareholders. Both sections would be subject to regular financial audits.
Also it should be noted that they have not objected to being audited by the NAO, just that it is done under the relevant section of the law, and have promised to make the results of the audit public.
As an individual I stood alone.
As a member of a group I did things.
As part of a community I helped to create change!
I can fully understand your frustrations, especially needing help or support to achieve something, but cannot get it because you have not managed to achieve it.
I totally agree with you regarding businesses becoming more savvy with how they deal with disabled people. For example I am a strong believer in supporting local shops, but frankly many do not help themselves. Narrow isles are bad enough, but when they also store stock on the floor even I find it difficult to shop in some stores and deliberately ignore them.
I have also come across attitude some people have that you mentioned, and again agree with you. I have always complained when I have come across this type of attitude, more often than not I have had possitive results from doing this.
As an individual I stood alone.
As a member of a group I did things.
As part of a community I helped to create change!
The average is about 2 years
Knowing that, it is extremely likely that people are never going to see the end of the lease in the first place and given the high risk of being re-assessed and losing the award will have no car until the award is reinstated.
PIP is far too volatile to chance taking on a Motability lease and having the car repossessed every 2 years or so.
More are now buying cheap runabouts knowing that the car will always be there despite what there PIP awards are.
The trouble with buying a car of your own is that you become responsible for maintaining it in roadworthy condition and getting valid MOT certificates, arranging your own insurance and also recovery. You also lose the perks of the special insurance set up that Motability have of additional drivers which is not available to most people under ANY circumstances. You also have to deal with having any special alterations made to the car yourself and finding people to do the work. In addition to this, at some point, you have to dispose of the car and take the loss in value which, in today's car market, is significant. Then there is the worry about getting NCB when you switch and the worry about losing it should you have an accident. Motability will provide an alternative vehicle, most insurers charge considerably more for the privilege.
Whilst some figures may sound a lot I think you will find that it isn't really a great deal should car prices drop significantly and lease car prices are higher still and don't provide the additional support.
TK.
You should have a copy of the lease and what was agreed to be paid. As I have never used Motobility I do not know what their leases look like. If it states how much you will pay for each month for the period of the lease than any extra money you get should be going to you. In which case it would be for the DWP to explain where the additional money has gone. As far as I am aware the way it works is that the costs of the car, insurance etc are covered over the period of the lease and this may include some interest or profit. It is why some cars require an upfront cost to keep payments low. There may however be some provision for increased payments later ie annually but these should be clearly set out.
I have already covered the 'idle funds' and why I don't believe them to be excessive and necessary.
Motobility have continued to increase the range of cars they have on offer, inlcuding those that do not consume 100% of the mobility allowance. Obviously if your needs are only going to be matched with high end cars than that comes at a cost.
As an individual I stood alone.
As a member of a group I did things.
As part of a community I helped to create change!
https://www.parliament.uk/documents/commons-committees/work-and-pensions/Letter_from_Lord_Sterling.pdf