UP to three-quarters of UK firms have reported staff quitting cash-for-car schemes and moving back into company cars, according to a new report.

The Monks Partnership Company Car UK 2002 report has identified that employees of large companies are reversing out of cash allowances and heading back into company cars.

The findings correspond with the Inland Revenue's forecast that there will be an incremental rise of 200,000 employees wooed back into company cars by the emissions-based company car tax system.

Pay and benefits expert Monks reported the new trend, despite finding that flexible employee benefits packages have seen the number of employees entitled to cash alternatives to company cars reaching record levels. Monks reveals that 82% of firms now offer cash allowances, up from 74% last year and just 6% a decade ago.

Take up of cash allowances varies, according to the type of company and seniority of the employee, with 35% of firms reporting more than 30% of senior managers have taken the option and 38% of firms saying the same number of middle managers have opted for cash. At director level, 53% of firms say more than 30% of board level staff have opted for cash instead of a car.

Yet despite the groundswell of support for cash-for-car schemes, 67% of large companies, with turnover of more than £500 million, report at least one employee moving in the other direction. This jumps to 72% at subsidiaries of larger corporations.

Among medium-sized firms, turning over between £100 million and £500 million, 36% report staff returning to company cars, with 46% of subsidiary companies agreeing.

However, among small firms with turnover of less than £100 million, none experienced the change, although 13% of their subsidiaries did.

Last year, one of the world's biggest insurers reported a swing back in to company cars among staff who had taken a cash option.

Marsh Corporate Services has a fleet of 1,400 company cars and 1,200 staff who have taken a cash option in the UK, but in April last year, a spokesman said more drivers had asked about the chance of moving back into a company car than in the past two years.