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4h ago

Transport Secretary Backs Curbing Luxury Cars in Motability as Treasury Weighs Budget Reforms

Downing Street called the reports Budget speculation, with existing leases said to be protected by Motability.

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Disability claimants could lose access to high end cars under Motability reforms (REUTERS/Piroschka van de Wouw)
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Overview

  • Media reports say Chancellor Rachel Reeves is considering removing access to premium marques such as BMW and Mercedes from the Motability scheme in the upcoming Budget.
  • Other elements of the all‑inclusive package are reportedly under review, including three‑driver insurance, overseas breakdown assistance and top‑tier cover.
  • Treasury sources present the potential changes as a value‑for‑money move, with suggestions of up to about £1bn in savings and possible VAT and insurance premium tax changes.
  • Transport Secretary Heidi Alexander said she would be comfortable with high‑end models no longer being available through the scheme.
  • Motability reassured customers that prices are protected for the duration of current leases, as figures show roughly 815,000 active leases and just over £3bn transferred from DWP in 2024/25.