Bosses of a disability car scheme that works closely with the Department for Work and Pensions have come under fire from MPs over their “totally unacceptable” salaries.
MPs on the Work and Pensions Committee have called for a National Audit Office investigation into the Motability Scheme after it was revealed that the chief executive of the operational arm of the scheme, Mike Betts, received a £1.7m salary last year.
The scheme allows disabled people to exchange their mobility welfare benefits for access to a new car, mobility scooter or electric wheelchair.
The company currently operates a monopoly in the sector as the only firm entitled to take welfare benefits in exchange for access to a vehicle. Although it is not directly funded by the government, the DWP works closely with Motability and facilitates the transfer of Disability Living Allowance and Personal Independence Payments to Motability on behalf of those claimants who have chosen to join the scheme.
A scathing report from the parliamentary committee said it was “difficult to square the high levels of executive pay and significant financial reserves at Motability operations with the scheme's charitable objectives and the wider context of pressures on welfare expenditure".
MPs have now called on Motability to grant “full access” to the NAO to conduct a value for money investigation into the scheme. They said that given the “privileged position, the absence of competitive tendering, reliance on public funds and question marks over its approach”, the firm has a “clear responsibility” to cooperate with the investigation.
The report revealed that Motability has reserves of £2.4bn in public funds, enough to weather a financial crash of similar size to the one in 2008.
Chair of the Work and Pensions Committee Frank Field criticised the charity’s executives for taking salaries that are ten times larger than that enjoyed by the prime minister.
He said: “It is impossible to calculate the human happiness that has resulted from the freedom and independence that Motability scheme – the first and only scheme of its kind – offers disabled people.
“But the organisation operates as a monopoly that faces no competition in accessing disabled people’s often hard-won PIP benefits.
“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. That one member of staff is paid over ten times what the prime minister earns, is one example of where Motability needs to get a grip of itself and realise the privileged position in which it trades.
“Its executives must cooperate with a full NAO investigation into the value it is offering the taxpayers who fund a significant chunk of its operations.”
Nicky Morgan, the chair of the Treasury Select Committee, said she believed the scheme had “lost its way”.
“The Motability Scheme is a valuable service that is helping over 600,000 disabled people live more independently," the Conservative MP said.
"But such high levels of executive pay and significant financial reserves are difficult to square with the honourable objectives of the scheme.
“It seems Motability may have lost its way. DWP should ask the NAO to carry out a full inquiry into the value for money of the Motability scheme. This could help ensure that those who rely on the scheme are able to access it on the best value terms.”
In a statement released earlier this year following questions in parliament about the scheme, Motability said: “The Motability scheme today is run on the same set of guiding principles that were established 40 years ago: to provide the highest standard of customer service, the best possible value for money, and financial sustainability for the long term. The scheme has provided a ‘road to freedom’ for millions of disabled people and their families, and will continue to do so.”