An urgent request has been put to the National Audit Office by Work and Pensions Secretary Esther McVey to look into the Motability charity after a row erupted this week exposing the scheme’s alleged £2.4bn of cash reserves and the £1.7m salary it pays its chief.
Speaking in the Commons, Ms McVey said the National Audit Office, which scrutinises public spending for Parliament, must ensure that spending money on the Motability package is a good use of benefits for disabled people.
The request came as the Motability scheme’s finances came under fire this week from politicians, who were said to have been “outraged” at the “grotesque” reserves. Labour MP John Mann called for an “urgent review” into the charity, which had previously been warned on its finances by the Charity Commission.
Mr Mann said that Parliament is interested in “the excessive profits and the scandal that a no-risk scheme has banks profiting so much and the charity itself quite unnecessarily holding £2.4 billion in reserves”.
But responding to this week’s reports, Motability Operations Ltd, which runs the scheme on behalf of the Motability charity, insisted it is a commercial body and that the £2.4bn surplus is a necessary cash buffer. The Group, which turned over £4.2bn in its last financial period, also maintained that boss Mike Betts’ £1.7m salary is justified due to the scheme’s performance.
Ms McVey said that while Motability has done “much good” and is a “lifeline” to many disabled people, the size of its reserves and pay packages call into question “the direction Motability has taken”.
She continued: “And with the current focus on corporate governance issues and the use of public money, I have today asked the National Audit Office to give consideration to undertake an investigation into this matter.”
Tory MP Philip Davies suggested that Motability packages should cost less for disabled people so that they can retain more of their benefits. He said: “Motability seems to be losing sight of what it was set up to do in the first place.”
In response to the reports this week, Motability Operations released a statement saying the scheme provides “an absolutely vital and important service to thousands of people across the UK”.