£400m donation from connected company sees Motability's income increase six-fold

The gift from Motability Operations means the charity's income rose to £428.7m from £72.1m in the previous 12 months

(Photograph: Rob Carter/Alamy)
(Photograph: Rob Carter/Alamy)

Income at the disability car charity Motability has soared to almost six times the previous year’s total after a £400m donation from the charity’s connected company.

The accounts for the year to 31 March 2019 show that Motability Operations, which runs a government-backed scheme to provide cars to disabled people, gave the charity £400m, pushing its income to £428.7m.

Income in 2017/18 was £72.1m after Motability Operations donated £45m to the charity, meaning there has been an almost six-fold increase in income in the latest financial year.

The rise in income means the charity’s unrestricted reserves have risen to £446.3m.

Spending rose to £37.3m from £2.2m the previous year, the accounts show.

The figures come after criticism of Motability Operation’s large reserves, which totalled £2.4bn in 2018, and the large bonuses paid to senior executives.

This led to a parliamentary inquiry into Motability’s policies and a National Audit Office report on the scheme.

A statement issued by the company at the time of the NAO report said it had donated £400m in "windfall profits" to the charity.

The 2018/19 accounts say Motability Operations initiated an external review in response to the NAO report. The review backed its approach to the reserves but suggested "adjusting assumptions underpinning the calculation of a number of conservative risk components".

Motability Operations therefore took the decision to release £370m in capital reserves as a result, the accounts say.

A statement from Motability said: "In late 2018, Motability received a donation of £400m from Motability Operations.

"The extraordinary size of this donation was made possible by the unusually buoyant second-hand market, in which cars have been selling consistently at values significantly higher than expected."

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