New mileage allowance rules are now in force from July 1, with key date announced for exceptions for essential travel including healthcare, education and employment to be published
Motability users have received an update on a major alteration to mileage rules which took effect from today. July 1 marks the introduction of new regulations for users – meaning fresh contracts will permit drivers to cover 10,000 miles before encountering a 25p charge for every extra mile beyond that threshold.
The former system allowed 20,000 miles with an excess fee of 5p per mile – sparking worries about the effect on disabled users and the escalating costs of the programme.
Motability had informed the Department for Work and Pensions that it would publish ‘exceptions’ for this by July 1 – but has now acknowledged it has missed this deadline.
Anxiety has been expressed that halving the rate will unfairly penalise disabled people residing in rural locations and those who must travel lengthy distances for employment, reports. In a fresh update, Motability provided a revised date – July 8 – for the alterations.
It said: “We know that every customer’s circumstances are different. For many customers, the standard mileage allowance should provide enough flexibility for everyday journeys. But we also know that some customers need to travel much further because of healthcare, education or employment.
“We are developing support to help with the cost of additional mileage for customers whose travel for these reasons is significantly higher than the standard mileage allowance is designed to cover. We’re currently finalising the way customers will apply for this support to make sure requests are assessed fairly and consistently.
“Support isn’t automatically available, we’ll consider each request individually and the outcome will depend on your individual circumstances, the journeys you need to make and the supporting information available. We’ll publish the full details, including how to apply and when customers can request support, on 8 July 2026.”
In a recent written Parliamentary question, Liberal Democrat Edward Morello asked Secretary of State for Work and Pensions Pat McFadden: “What assessment his Department has made of the potential impact of reductions to Motability mileage allowances on disabled people living in rural constituencies in the South West.”
In response, Sir Stephen Timms, Minister of State for Social Security and Disability, said: “Responsibility for the Concerns and administration of the Scheme sits with Motability Foundation and its Board of Governors. The Department for Work and Pensions meets quarterly with Motability Foundation, to discuss the Schemes operation.
“The changes to the leasing package were announced on 26 March 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 fewer miles than the proposed new mileage allowance. Motability understand that this will affect customers differently and are keeping these changes under review.”
The alterations to the scheme have been plagued with difficulties. The disabled car leasing service abruptly halted its Drive Smart black box programme – and admitted the experience for users has been below par.
The controversial scheme demanded all new first-time leases and those with named drivers under 30 to fit the device. It stated: “The Drive Smart update does not relate to the mileage changes announced in March. Drive Smart was introduced to manage rising Scheme insurance costs.
“The changes made to the mileage allowance from July 1 was due to the new tax costs announced in the Autumn Budget (which apply from July 1). These costs would add £1,100 to leases on average if no other action is taken, and we know this would be unaffordable for many customers. The majority of customers (73%) currently travel 10,000 miles a year or less and would be unaffected.”
Motability journeys which can be considered for ‘exeptions’ rule
Motability said: “If you’re likely to exceed your mileage allowance because much of your travel is for healthcare, education or employment, we may be able to help. We’ll consider journeys such as:”
Healthcare
- Hospital and GP appointments
- Specialist treatment
- Other essential healthcare or support services
Education
- Travel to your own education or training
- Taking your children to and from school
Employment
- Travel to and from work
Travel for holidays or leisure activities will not be included when Motability assesses requests for additional support.
What happens next?
From 8 July 2026, Motability will publish:
- Who can apply
- How to request support
- What supporting information we may ask for
- How we’ll assess requests
- The support available if your request is approved
- What to do if your circumstances change during your lease
- How to ask us to review a decision if you disagree with the outcome
It added: “If you’re considering ordering a vehicle and think your travel needs may be higher than the standard mileage allowance, you may wish to wait until we’ve published the full information on 8 July before making your decision. If your lease is due to end before 8 July, please call us to discuss your options.
“If you’re joining the Scheme and think your travel may exceed the standard mileage allowance, you may wish to wait until we’ve published the full information on 8 July before placing your order.
“Talking to us before your lease starts means we can discuss what support may be available and help you decide whether the Scheme meets your travel needs.”
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