What’s the problem with ECOS?
Regarding Rob Chisholm’s letter “Why do we need ECOS?” (Fleet News, May 17).
These are not “contrived schemes” but designed on the basis that the vehicle is owned by the employee and not the employer. The suggestion that all ECO schemes are a form of tax avoidance is incorrect. While I acknowledge that some schemes do border on tax avoidance, the majority are using tax legislation to minimise cost to employers.
This is no different to many of the other tax planning ideas employed by corporates, for example salary sacrifice to minimise tax cost. HMRC has looked at this area in detail and have given guidance to inspectors as to what is acceptable.
Mr Chisholm also suggested that company cars are more CO2 efficient. But the SMMT’s latest report showed that individuals, not corporates, had been buying the most CO2 efficient vehicles.
I recently carried out an extensive study of the CO2 emissions of vehicles acquired under an ECOS and compared my research to published results for company cars. There was only a minor difference. The CO2 emission levels for some industries was higher than the average for company cars, but I was told that if employees had been switched back into company cars there would still be the same type of vehicles taken – it was HR policy to recruit and retain quality staff.
Little incentive for van users
HMRC policy should encourage road safety not discourage it.
We have over 300 mobile service engineers and are again faced with the issue of whether they should be in vans or those stalwarts of the service industry, the Astra and Focus estates.
Increasing health and safety and environmental concerns mean that our engineers have to carry more equipment with them (particularly working at height and gas recycling equipment). The argument in favour of vans is therefore very strong. However ,you try persuading an engineer that he has to trade in his family’s estate car for a van.
The introduction of CO2-based car tax worked in favour of safety. Engineers could see they were better off financially in a van. As a group we also gave financial incentives for those switching. Most of our engineers have two-vehicle families so having a work van often suited them. They were able to afford a better private car and still have a van available at weekends for short private trips.
The new van benefit-in-kind (BIK) amount of £3,000 is comparable with the BIK on an Astra or Focus estate. From our engineers’ perspective, why have a van when the tax is the same as an estate?
At this time of increasing health and safety concern HMRC policy should encourage the use of vans rather than estate cars.
One answer would be a reasonable level of private van use (say 5000 miles a year) before the £3,000 BIK kicks in. Alternatively abolish BIK on vans entirely.
The result of HMRC policy will be a switch from vans to estates with an increased risk of overloading or unsecured loads. It will be interesting to see the change in the respective sales of vans and estates over the next year or so.
Group financial director, Carter Thermal Industries
High noon for the cowboy repairers
The new repairer Kitemark, PAS 125, is undoubtedly welcome and long overdue.
In fact, the optimism of your article (Fleet News, April 26) reiterates the enthusiasm that even many repairers themselves have for the initiative.
It is seen as a chance to demonstrate their professionalism, credibility and dedication to quality.
As every aspect of the industry continues to develop and professionalise, repairers are a vital link in the chain. They have a key role to play in elements that impact on customer satisfaction – whether it is service, effective cost control or improved safety.
In FMG Support’s experience, particularly through our Partner Support programme, there are many repairers and bodyshops who, with our help, consistently work to develop their expertise in areas such as complex repairs, in-vehicle technology and maintaining the highest safety standards.
In addition to this, the Partner Support scheme has pre-empted the focus on process management that is within the Kitemark accreditation.
This is something that should not be overlooked as agreeing KPIs and improving administration and time management all have an impact on managing repair costs, replacement hire charges and vehicle downtime.
However, while the “Kitemark Sheriff” may well be riding into town as a figure that brings justice and order to an unregulated wilderness, we will have to wait and see whether it will be pistols at dawn between the regulators and the cowboys that still exist.
With such standards there needs to be a balance between policies that develop best practice and red tape that threatens to stifle progress.
We also need to be assured that there will be enough inspectors to ensure that it is implemented effectively and stringently so that the Kitemark has the credibility that it should represent.
If this can be achieved, then official accreditation should go a long way to improve the reputation of an industry which has been damaged by poor practice.
Furthermore, bodyshops and repairers who use accreditation as a springboard to raise the bar even higher will not only buck the trend, but they will continue to reap the rewards.
Head of supply management, FMG Support
No clarity on smoking
Recent surveys have found that up to a quarter of employers and half of the public are either unsure about or unaware of the forthcoming smoking ban in England.
According to the NHS, 25% of the population smoke, which works out at roughly a million business drivers in the UK.
At present, a van driver travelling from Cardiff to Glasgow is subject to three different smoking régimes and two significantly differing requirements for no-smoking signage. Scotland’s ban does not extend to cars, whereas the rules for England, Wales and Northern Ireland include most cars used primarily on business.
Including cars in the ban will be controversial. For instance, private cars used mainly for work will have to be smoke-free at all times, which will definitely confuse owners used to doing what they like in their own car.
Fleets need clear guidance. Unfortunately, the official advice to fleets in England is not as unequivocal as might be hoped.
That’s certainly been our experience, so we’ve had high demand for the free drivers’ guide we’ve produced to detail exactly what the law will mean to our staff.
No company wants itself, its fleet manager or a driver to be the first to face an enforcement penalty, especially if the offence was committed unintentionally.
Commercial director, Alphabet