This decision follows a long review by the National Audit Office (NAO) and Treasury and Work & Pensions Committees. The decision means that the levels of reserves held by Motability will fall from £2.5 billion, which the reviews concluded were “out of proportion to the risks it faces.”
Motability Operations (the official name of the firm that runs the scheme on behalf of the Motability charity) issued a press statement, which said:
- The Board resolved to release capital reserves to a level of £370m below the September 2018 balance sheet position.
- The Board plans to commit £100m of this release to support customers. The balance of the remainder, along with all this year’s profits, will be donated to Motability to provide wider support for disabled people and their families.
Commenting on the decision, Nicky Morgan, Chair of the Treasury Committee, said: “Last week’s announcement by Motability Operations – that it will release £370 million from its reserves to support customers and disabled people with mobility needs – is good news for members of the scheme.
“Motability Operations must now ensure that its customers will benefit from this either in the form of lower prices or more generous vehicular adaptations.”
The Motability Scheme helps people with a disability who want to exchange their government-funded mobility allowance to lease a brand new car, scooter or powered wheelchair, giving them the freedom and independence that most people take for granted.