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Motability: Fraud

Volume 480: debated on Monday 6 October 2008

To ask the Secretary of State for Work and Pensions (1) how many cases of fraud or misuse of the Motability scheme (a) were recorded and (b) led to cancellation of car hire contracts in each year since 1997; (224089)

(2) how many people used the Motability scheme in each year since 1997.

[holding answer 17 September 2008]: Motability is an independent charitable company and is responsible for the administration of the Motability scheme.

The information in the following table has been provided by Motability.

Number of customers using the scheme

Allegations of fraud or misuse recorded and investigated

Contracts cancelled as a result of fraud or misuse

1997

341,222

Not available

Not available

1998

359,289

Not available

Not available

1999

378,036

4,032

378

2000

388,761

2,107

253

2001

396,580

3,652

260

2002

398,744

3,728

249

2003

391,356

3,236

266

2004

391,548

2,896

140

2005

414,082

3,716

36

2006

438,290

2,704

197

2007

463,812

3,665

549

2008 (forecast)

490,000

3,750

550

Notes:

1. Consistent and reliable records of the numbers of cases of possible fraud or misuse being recorded and investigated, and of the resulting numbers of customer contracts cancelled, are only available from 1999 onwards, after Motability established a centralised team to handle such matters in 1998.

2. The fall in the number of contracts cancelled as a result of misuse between 2003 and 2005 resulted from an increase in the standard mileage allowance in 2003 (hence fewer customer contracts being cancelled for unpaid excess mileage bills) and from an improved approach to “fair wear and tear” standards, especially for damage associated with mobility aids (fewer contracts being cancelled for cars falling outside of the condition standards).

3. The increase in customer contracts being cancelled since 2005 has resulted from a stronger focus on appropriate sanctions for customers using cars in any criminal activity or using cars outside of the insurance rules (e.g. allowing uninsured drivers).