AN increasing number of fleets are turning away from cash alternatives and returning to company car schemes.

Only 40 out of 251 firms questioned said they were likely to offer cash in the future, compared to half the respondents in a survey in 2005.

Duty of care was given as the main reason for abandoning cash-for-car schemes – firms found that complying with legal control and oversight requirements on vehicles used for company business was easier with company cars.

The survey by leasing firm Alphabet found that 63% of firms said they did not intend to increase their cash offerings, while 11% were less likely to offer cash in the future.

Overall, 32% of employers were in favour of returning to company cars, particularly firms with larger fleets of 100 cars or more. They said company cars were easier to control and manage.

Alphabet’s commercial director Richard Schooling said: ‘These findings certainly suggest that more employers are factoring issues such as duty of care and adequate control over driving at work into their fleet funding decisions.

‘They also underline the fact that the decisions firms make on fleet funding and at-work road safety are inextricably linked. Of course, businesses can leverage the link to design safer, lower-cost fleet operations.’

The Risk and Reward 2007 survey also found that 22% of firms reported an increase in employees taking company cars rather than cash over the last two years, while 26% reported more drivers taking cash.

Only a third of drivers had a choice between a company car and a cash alternative.

Tax was the factor that carried the most weight with employers, company car drivers and opt-out drivers, who all cited it as a key factor in any future decisions on car benefit.