NAO chief Sir John Bourn said the Motability scheme offered good value for money to disabled people - particularly those on a low income who would not otherwise be able to secure a lease or hire purchase agreement.
Although the report followed a routine investigation into the activities of Motability, Europe's largest fleet, it follows mounting pressure in the media for more information about the secretive operations of Motability Finance Limited - the private consortium of banks which has provided funds since its establishment in 1977.
The report - initiated last May (Fleet News May 19, 1995) - found that Motability supplies vehicles for the disabled at around 30% less than commercial contract companies charge fleet operators - although Motability payments are not subject to VAT - making the difference closer to 10%. The report also found there were no conflicts of interest arising from board members of Motability also sitting on the board of Motability Finance Limited. The NAO did however make several recommendations for improvements in both Motability and MFL's operations to build on initiatives already made since 1994.
The key recommendations included:
Motability chairman Lord Sterling of Plaistow said: 'By confirming the good value for money provided under the Motability Scheme and by refuting allegations about conflicts of interest, the NAO report rebuts the unfounded allegations on these issues to which Motability has been subjected.'