Salary Sacrifice scheme proposes new cars for council staff in Scunthorpe area after business mileage rates cut - with the aim of saving public money
A scheme giving council staff the chance to buy brand new cars at competitive prices - including the cost of maintenance, insurance and breakdown cover - could be made available to many who are based in Scunthorpe and other areas of North Lincs.
North Lincolnshire Council is considering the scheme, abbreviated to SS4C, under which staff would be given the chance to buy new cars in return for giving up part of their pay - described as Salary Sacrifice.
It is said the authority's finances - and the public purse - will benefit, along with staff.
As part of plans "to mitigate reductions in business mileage rates" Human Resources officers at the council "entered into dialogue" with Tusker Direct Ltd - the provider of the award-winning SS4C scheme.
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A council report says: "Salary sacrifice arrangements involve an employee sacrificing an element of their pay before tax and national insurance (NI) contributions are taken, in return for a benefit, in this instance a new car.
"The employee saves tax and NI on the amount sacrificed and the council saves the NI on the sacrificed amount.
"The council currently runs successful salary sacrifice arrangements for childcare vouchers and has done so for the Cycle to Work scheme."
Tusker has 21 "live schemes" with councils across the UK, with a further 11 "in scoping and implementation."
Under the heading Benefits, the North Lincolnshire Council report adds: "The SS4C scheme allows the council to provide employees with a new, fully-maintained and insured car at a lower cost than they could normally achieve in the retail market.
"In addition to the tax and NI savings each month, employees benefit from corporate buying power and public sector discounts. Introducing the scheme costs the council nothing.
"All servicing and maintenance of the vehicle is included in the monthly salary reduction, along with fully comprehensive motor insurance and roadside assistance."
The report adds: "Although the reductions in business mileage rates primarily affect ‘essential users’ a significant financial impact will also be felt by many ‘casual users’.
"SS4C scheme entry can be provided to the majority of the workforce regardless of whether there is a requirement for an employee to undertake business mileage.
"The greater the number of employees that enter the scheme, the greater the saving to the council.
"As a cost neutral benefit the SS4C scheme is a useful addition to the council’s retention package and would not involve any subsidy by the council."
The report concludes: "As with other salary sacrifice schemes the SS4C scheme is designed to achieve a saving for both employees and the council. Savings for the council will be dependent upon the scheme parameters set and employee take up. Administration of the SS4C scheme is minimal as the scheme is largely administered by Tusker."
Consultations have show trade unions in favour of "any steps taken to mitigate the impact of reductions in business mileage rates."
No estimated savings have been included within the report.
A decision on whether to adopt the Salary Sacrifice For Cars Scheme at North Lincolnshire Council is due to be made within the next week - at cabinet level.
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