Motability Operations confirms it is to donate entire £800million profits from the year to Motability
Motability Operations has announced it is donating £800million to the Motability charity’s new endowment fund to be used to enhance the lives of disabled people.
The money is in addition to £100 million already committed by Motability Operations as direct support for Motability Scheme customers, which has been used to increase the bonus paid to customers for the return of cars in good condition, amounting to a cash payment of £600.
Contracted by Motability (the Charity) to operate the car, powered wheelchair & scooter scheme, Motability Operations have operated the Scheme since 1978, leasing vehicles to recipients of qualifying mobility allowances across the UK.
With 1.8million people in receipt of a qualifying allowance allowing them to choose to lease through the scheme, there are over 600,000 customers who use Motability.
This most recent charitable donation comprises of all of Motability Operations’ profits for the year, plus the release of capital reserves of £370 million that was announced in June.
This brings the capital reserve £370 million below the September 2018 balance sheet position says Motability Operations, explaining that since capital reserves are not held as cash but are used to purchase cars, the business has had to borrow on the financial markets to put the release into effect.
Motability Operations notes that it does not end its financial year until 30 September, so a final top-up donation may be made before finalising and publishing the financial results in December, at which point the precise profit position is ratified.
The eye-watering donation comes following the end of a controversial saga in which Motability Operations and the entire Motability Scheme was called into question after it was discovered that Motability Operations’ had substantial reserves and had paid top executive’s bonuses deemed excessive.
Sir Stephen O’Brien, Chairman of Motability Operations commented: “We are pleased to be making this substantial donation which will help Motability improve the lives of many more disabled people. The Board is confident that following the rebasing to this revised capital position, and the donation of this year’s profits, the business remains robust, affordable for customers, and sustainable for the long term.
“In planning the donation, we have sought a balance between additional support for Scheme customers and seeking opportunities to improve the lives of a wider range of disabled people through donations to Motability, the Charity.”
In accounting terms, the donation will require Motability Operations to record a loss this year, however, the company states that it will not affect the business’s ability to meet its liabilities and it will remain in strong financial health.https://thiis.co.uk/motability-operations-donates-entire-800million-profits-from-the-year-to-motability/https://i1.wp.com/thiis.co.uk/wp-content/uploads/2019/07/Motability-1.jpg?fit=1000%2C692&ssl=1https://i1.wp.com/thiis.co.uk/wp-content/uploads/2019/07/Motability-1.jpg?resize=150%2C150&ssl=1Investments & FundingNewsroomThird Sectordonation,Endowment Fund,investment,kMotability Operations,Mobility scooters,Motability,Motability saga,Motability Scheme,powerchairs,profitsMotability Operations has announced it is donating £800million to the Motability charity’s new endowment fund to be used to enhance the lives of disabled people.The money is in addition to £100 million already committed by Motability Operations as direct support for Motability Scheme customers, which has been used to...Calvin BarnettCalvin Barnettcalvin@thiis.co.ukAdministratorTHIIS Magazine