Fleet News

Tusker disputes ACFO salary sacrifice claims

Tusker has hit back at ACFO claims about the level of take-up of salary sacrifice car schemes, saying in its experience it is ‘significant’ and averages 8.3% amongst all eligible employees.

A recent survey by the fleet managers’ trade association ACFO reported a take-up of just 0.6%, a level that it said appeared to be “significantly below that indicated by many of the providers of such schemes”, adding that “car salary sacrifice only appeals to a miniscule number of employees”.

However, that it is not the experience of Tusker, which currently has more than 75 live schemes and has been running its salary sacrifice car scheme, SS4C, for over three years.

Tusker’s scheme has seen an average take-up of 4.5% across those schemes that have been running for 12 months or more and an average of 6.8% for schemes that have been running for over 24 months. Take up for schemes that have been running for three years or more is currently averaging 8.3%.

Tusker managing director David Hosking said: “Whilst a small number of Tusker schemes have enjoyed a take up of only 2-3%, these are the exception rather than the norm and can usually be attributed to the demographics and geographical location of the employee base, as well as how the scheme is set up and communicated to the employee population.

“There are a number of things that need to be done to achieve average take-up of over 8%, but we are continually improving the ways in which we work with our customers and expect take-up levels to increase above 10% as an average across all our schemes in the near future.

“We recently launched a scheme to a utilities company with 10,000 employees and have seen 475 orders placed thus far in just over 12 months.

“This is typical of the level of take-up our schemes enjoy and, in addition to the significant savings in tax and NI for the employees, the employer has made projected savings in employers’ NI of well over £400,000 on the orders placed so far and we expect this to increase to around £800,000 over the three-year term of the scheme.

Tusker says that there has been a basic misunderstanding in some quarters of what salary sacrifice car schemes are actually offering and who they are aimed at.

“Typically, they do not impact greatly on the type of company fleet that fleet managers normally run,” explained Hosking.

“We actually believe the ‘traditional’ company car fleet and salary sacrifice car schemes are complementary and not mutually exclusive, as we provide vehicles for both.”

Hosking said that salary sacrifice car schemes existed to extend the range of flexible benefits available to employees in a tax-efficient and environmentally-friendly manner.

He added: “In much the same way that pensions, health insurance, dental treatment, childcare and other benefits are offered to employees, salary sacrifice car schemes widen employee choice.

“They can in certain circumstances, replace traditional company car schemes if that is what the client wishes. But this is not typical in our experience.

“Instead, they open up the opportunity of running a fuel efficient, usually lower polluting new car amongst groups of employees who would not necessarily previously have qualified to receive a company car or had access to low cost and extremely tax-efficient new car provision.

“They address duty of care concerns and also encourage green credentials as they promote low carbon emitting cars and provide major savings in income tax and National Insurance at no extra cost to the employee or employer.

“We have never said they are a panacea, but we know from our own research that drivers like the fact that a salary sacrifice car scheme gives them an all-inclusive way of running a new car with a known fixed monthly cost and no unexpected expenses or hidden surprises and, with an average take up rate of over 8% and rising, we know a significant number of people want to make use of them.”

 

 

 

 


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