Matt Ryder, the former head of Motability policy at the Department for Work and Pensions (DWP), has expressed concerns that recent cuts to luxury car leases under the Personal Independence Payment (PIP) scheme are insufficient. His comments come in response to Motability Operations’ announcement that it will immediately stop leasing high-end models like BMWs, Audis, and Mercedes.
Speaking to the I, Ryder criticised the move as largely symbolic, stating, “These changes won’t make much difference. They don’t go far enough and will not save taxpayers any real money.” He highlighted that Motability continues to offer high-spec models from other brands and warned there’s no assurance these luxury vehicles won’t return in the future.
Ryder emphasised the need to end tax reliefs associated with Motability, calling it a “missed opportunity” if the government fails to do so. “Ending tax relief would generate revenue and remove a hidden subsidy within the benefits system,” he explained.
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He also pointed to the rising number of mental health-related mobility awards under PIP, suggesting that a thorough review of these claims is necessary. “If the government wants to restrain PIP spending, it needs to make clear, decisive choices,” Ryder added.
The move has been criticised by politicians across the spectrum. Conservative Shadow Work and Pensions Secretary Helen Whately dismissed it as “window dressing,” urging for more substantial reforms. Lee Anderson, welfare spokesperson for Reform UK, echoed that sentiment, stating the changes “do not go far enough.”
Labour Chancellor Rachel Reeves, meanwhile, has expressed commitment to overhauling the welfare system. Speaking on Channel 4 News last month, she said, “We can’t leave welfare untouched … We have to do reform in the right way and take people with us.” She is anticipated to introduce measures such as ending certain tax reliefs for Motability cars, including applying insurance premium tax and charging VAT on advance payments for higher-value vehicles—moves expected to increase leasing costs.
The consensus among experts and politicians alike suggests that capping luxury vehicles under PIP is a starting point, but comprehensive tax and eligibility reforms are crucial to ensuring the scheme is financially sustainable and fair.