DWP to give major update in weeks on July 10,000-mile limit | Personal Finance | Finance
The Department for Work and Pensions (DWP) has confirmed it will provide an update before July 1 over changes to a new 10,000-mile annual limit under the Motability scheme. Under new contracts starting from July 1, 2026, people taking out a new Motability lease will be allowed to drive 10,000 miles per year before paying 25p for every additional mile.
The current allowance is 20,000 miles with an excess charge of 5p per mile. The planned reduction has prompted concerns from some MPs and campaigners about the impact on disabled people who rely on their vehicles for work, medical appointments and education. In a written parliamentary question, Liberal Democrat MP Will Forster asked in what circumstances the reduction in mileage allowance could be mitigated.
Responding, Sir Stephen Timms, Minister of State for Social Security and Disability, said: “Responsibility for the terms and administration of the Scheme sits with Motability Foundation and its Board of Governors. This includes how they will determine what circumstances the reduction in mileage allowance can be mitigated.
“Motability have indicated that they will be introducing an exceptions process for very limited situations and will share an update before 1 July.”
The changes were first announced on March 26 and will apply only to new leases. There are no changes to the mileage allowance for existing customers.
In a separate answer to Independent MP James McMurdock, Sir Stephen said: “The changes to the leasing package were announced on March 26 and include reducing the mileage allowance from 20,000 per year to 10,000 per year.
“Changes only apply to new leases and there are no changes to the mileage allowance of existing leases. Motability Foundation have advised that approximately 75% of customers on the Scheme already use less miles than the proposed new mileage allowance.
“They have acknowledged that there will be an impact on some customers and are considering if the impact can be mitigated in some limited circumstances.”
Motability says its average motorist drives around 7,500 miles per year.
As part of wider changes, telematics technology will be introduced in all cars for new drivers and for any lease that includes a person under 30. Drivers will need to have a black box fitted and download an app to their phone.
The system, known as Drive Smart, monitors behaviour such as speed and braking and provides a weekly rating of green, amber or red. If a driver records a red week, both the customer and the driver will receive feedback.
If dangerous driving continues for two consecutive weeks or four weeks within 12 months, the driver may be removed from the scheme.
Motability Operations said Drive Smart was introduced in response to rising insurance claims and “focuses on how someone actually drives, rather than relying on indirect measures of risk like postcodes”, while it had been designed to “support and reward safer driving”.
A spokesperson added: “We’re listening closely to what our customers are telling us as we continue to review and refine how Drive Smart works.
“In particular, we know usage is one of the biggest areas of feedback. We are actively reviewing how it is reflected in scores to help reduce some of the concerns customers are feeling.
“High usage will not impact a lease, because we know how important the scheme is for supporting customers with freedom and independence. We also recognise that many of our customers have different driving needs, including those who use adaptations, and we are developing the model to better reflect this.”
A parliamentary petition calling on Motability to abandon the changes has gathered nearly 50,000 signatures. It must reach 100,000 signatures by July 15 to be considered for debate in Parliament.
Anyone who wishes to sign the petition can do so here.
