Business Car Manager: Editor’s Blog

THE public sector is going to be very much in the spotlight. Having escaped the ravages of the recession last year, in a delayed ‘recession echo’ the sector is likely to be hit with savage spending cuts this year as it adjusts to funding shortfalls prompted by the Chancellor trying to bring some semblance of balance to the nation’s books.

So I thought it showed great vision – opportunity? – for Nexus, a daily rental vehicle broker, to launch its vehicle mileage calculator. Or, as Nexus prefers to call it, an MVR tool (Mileage Versus Rental) application.

Nexus provides the example of a public sector worker using their own vehicle for a work-related journey being repaid at a staggering average of 59p per mile.

Yes, you read that right. For the likes of you and me running personal cars on business we get 40p per mile without incurring any tax. This public sector average figure is nearly 50% more! (Do they own up to it on their tax returns I wonder?) Anyway, this is incidental.

Nexus suggests that such a typical public sector worker undertaking a 180-mile business trip would cost a county council an average of £106.20 – yet if they made the journey in a rental vehicle it is likely to cost the council somewhere in the region of £46.

The new Nexus app helps councils decide how best to use the money by providing a clear decision on which is financially to the council’s advantage.

I applaud anything that will keep council spending down – especially if it provides an efficient alternative that does the same job for less. So let’s hope enlightened councils take up the idea.

I tried a demo out using my Audi A6 – at the usual 40ppm AMAPs rate (Authorised Mileage Allowance Payment) I claim back from the business. Over a 200 mile business journey the tool reckoned £80 for using the AMAP rate and just £53.33 for a rental car inclusive of fuel.

Now while this application is for the public sector, the reasoning behind it is sound for small businesses. It could be much better for your business to put a staffer in a rental car for a business journey, rather than let them use their private car – and ensure it’s fit for purpose, fully insured and so on.

It’s certainly worth thinking about – rather like car clubs for more local journeys. Being flexible in your approach I think is key for small businesses and their business travel. It’s one of the themes explored in the latest piece looking into the future of company cars by LeasePlan and written by Buckingham University’s Professor Peter Cooke. You can read our special report on the issues it raises here: Is your business changing its company car provision?.

So now Nexus, how about a mileage app for small businesses to work out if it’s worth using private cars for business trips – or to use a rental car?