The size of one of the world’s largest fleets could shrink by more than 140,000 vehicles, but experts believe the potential decline and short-term rise in annual de-fleets will have little impact on the new or used UK car markets.
The Government’s decision to change the qualifying rules for disability payments means the size of the Motability fleet, which currently stands at 610,000 vehicles, is forecast to shrink over the next six years.
The change is being imposed in a bid to save millions of pounds, and means that from April 8 the Disability Living Allowance (DLA) will be replaced with the Personal Independence Payment (PIP) scheme.
A tougher qualification criterion for the new allowance, which is being phased in with all those currently in receipt of DLA expected to have been assessed by late 2018, means that thousands of people are likely to lose the higher mobility component (currently £54.05 a week) that qualifies them for eligibility for a Motability vehicle.
Disability Rights UK calculated that with currently about a third of people in receipt of the enhanced mobility allowance (1.8 million) taking advantage of the Motability scheme, about 93,000 fewer Motability vehicles would be leased.
However, revised caseload forecast assumptions from the DWP published last month (December) suggest that once managed reassessment is complete in 2018 as many as 428,000 people could lose their right to the newly named enhanced mobility allowance meaning possibly as many as about 142,000 fewer Motability vehicles being leased.
The change is driven by a need to cut spending but perhaps indicative of a public backlash the Government last month (December) announced a delay in plans to reassess the entitlement of the majority of claimants until after the next general election, which is due in May 2015.
A DWP spokeswoman said: “We’re working closely with Motability to understand what impact PIP might have on their customer numbers and to ensure they are well placed to manage the introduction of the new benefit.”
The DWP say 71% of people currently received DLA for life without systematic checks to see if their condition had changed and that there were hundreds of millions of pounds in overpayments.
The spokeswoman added: “We have extended the reassessment period and have made significant changes to the assessment based on feedback from disabled people and their organisations.”
Neil Coyle, policy director of Disability Rights UK, told Fleet News: “We are in regular contact with both the Department and Motability.
“We are potentially looking at more than 140,000 people losing their entitlement to a Motability vehicle, although that figures does not allow for new people qualifying. However, there are many different ways the reassessment could pan out.
“We have made the Government very aware that genuine disabled people may lose out in this massive change. Access to a Motability vehicle also helps many disabled stay in employment because one of the barriers that they face is access to transport.
“We forecast that 25,000 disabled people may not stay in work through losing their Motability vehicle.”
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