Future of Work

The £1.7m salary paid to the chief executive of the firm which runs the Motability disabled car scheme is “totally unacceptable,” say MPs.

The remuneration package of Mike Betts has grown by 78% from £954,000 in 2008. Motability said Mr Bett’s pay was based on a comparison with FTSE 250 firms.

The Treasury and Work & Pensions committees found funds of £2.4bn were also being needlessly hoarded. The National Audit Office would look into the issues raised, the government said.

“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.

The Motability scheme arranges cars for disabled people in exchange for some of their state disability allowance – their Personal Independence Payment benefit.

Motability Operations – the firm which runs the scheme – is a monopoly which faces no competition.

The two Parliamentary committees say that the government needs to explain why state assistance for the firm – in the absence of competition – is an appropriate use of public money.

‘Totally out of whack’

Frank Field MP, chair of the Work and Pensions Committee, said that Mr Betts’ pay is over ten times what the Prime Minister earns.

“The levels of pay pocketed by its executives and the cash reserves it is hoarding are totally out of whack with reality of its position in the market,” he added.

Mr Field said that Mr Betts’ pay is over ten times what the Prime Minister earns.

Nicky Morgan MP, chair of the Treasury Committee, said the “high levels of executive pay and significant financial reserves are difficult to square with the honourable objectives of the scheme”.

“It seems that Motability may have lost its way,” she added.

Motability Operations has denied having built up “spare” money and says it has provided 4.5 million vehicles to disabled people and their families since its 1977 launch.

On chief executive Mike Betts’ pay, the firm said it was “reviewed against the market to ensure that it is both competitive over the long term and to make sure that any rewards are related to performance especially in relation to the quality of service provided”.

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