Companies across Europe are introducing cash alternatives to the company car, with Britain easily remaining as the top provider for cash for car schemes.

The figures are contained in a new report by consultants Watson Wyatt, which controversially claims cash schemes are actually on the increase in the UK.

The company’s research flies in the face of many recent reports about the UK car market, which found that firms were pushing drivers back into company cars as a result of duty of care concerns.

However, Watson Wyatt found that double the number of employers - more than a quarter in total - now provide a cash allowance instead of a car compared to four years ago.

Around half offer a choice between the two.

However, one variable not published is the strength of influence within a company to get drivers back into company cars, meaning the influence of duty of care, or the actual take-up of either scheme is not clear.

Numerous recent reports over the last two years, including one last month from Market Business Development, have claimed that employers were dropping cash alternatives.

The Watson Wyatt reports refuted those claims, stating: “Cash is in the driving seat for an increasing number of UK employers’ company car policies.”

In the rest of Europe, the direct provision of a company car without any cash choice is more widespread, with around 70% of employers in Belgium, Greece, Italy, Portugal and most central and eastern European countries, providing company cars only.

Offering a cash alternative is spreading though as the European fleet market matures and as more pan-European policies are formed.

“Compared with four years ago, the proportion of employers offering cash or a cash alternative has gone up by 40% in the Netherlands and in Ireland, 32% in Germany and 24% in Sweden,” said Anne Severeyns, senior consultant at Watson Wyatt.

“However, this is partly driven by companies creating pan-European company car strategies; while employees in these countries may be offered a cash alternative, the majority will still go for the car because of tax efficiency.”