Salary sacrifice on the rise with big companies
03 June 2013
Author: Jack Carfrae
Salary-sacrifice schemes are holding greater weight withbig companies and are becoming increasingly popular as staff perks. The uptake is being credited to the fact that businesses have become more comfortable with both the economy and the idea of the schemes themselves.
Mike Moore, director at Deloitte Car Consulting, told BusinessCar: "This is something that's proving popular and more larger employers are now offering it.
"It used to be seen as something quite exotic and a bit risky but [the rise] is primarily down to businesses getting more comfortable with the concept and leasing firms buying into it."
Moore claimed the recession was largely to blame for the way in which salary sacrifice had previously been perceived, and that it is now being considered as a strong employee perk by large businesses.
"What held it back initially was that when it was being promoted we went into the crash. One of the risk areas is employee attrition and the early termination charges.
"Generally speaking, things are less uncertain now and businesses are used to the economic climate.
"Most employers have some way of managing attrition now and the providers have ways of resizing and looking to recycle vehicles as well."
Leasing firm and salary-sacrifice specialist Zenith has reported an increase of 70% in the schemes over the last year, and said that demand has remained strong since the financial year change in April.
Commercial director Ian Hughes said take-up of cars slightly above the 100g/km threshold had proved strong under the scheme, despite the greater benefits of vehicles that dip beneath it.
"It is interesting to see that although sub-100g/km cars are the most popular, and there are many to choose from in that category, a significant number of drivers are still selecting vehicles above that threshold.
"They are still able to save money on the slightly higher-emitting cars while also benefiting from the. package, fixed costs and potentially lower fuel costs than in their previous car.
"As we expected, petrol cars are increasing in popularity and taking market share from diesel models."