24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME Version: 2 Last Updated: 21/10/08 Review Date: 21/10/11 ECHR Potential Equality Impact Assessment: Low 1. About This Procedure 1.1. This procedure details the arrangements and conditions for providing a car to a member of staff under the Constabulary’s Subsidised Car Leasing Scheme. 1.2. Under the scheme the Constabulary will contract hire a new car of the member of staff’s choice for four years. The car, which is normally to be used for all business travel, is returned at the end of the contract period and the member of staff may then choose to enter into a further agreement. 1.3. The car will also be available for the member of staff’s private use. 1.4. The car will be financed by a specified annual contribution from the Constabulary; any remainder being met by a contribution from the member of staff. The member of staff will be reimbursed for petrol in respect of business mileage on a cost basis. 1.5. The scheme is administered for the Constabulary by the County Treasurer’s Department of Hampshire County Council. 1.6. A member of staff who wishes to join the scheme should study all the terms and conditions carefully before entering into a commitment. The member of staff will be deemed to have accepted these conditions on making an application for the car. 1.7. Applications to be made via the Car Lease Scheme Application form. Click here to view the Staff Benefits & Pensions, Intranet site. 1.8. This procedure is derived from 24000 Policy – Pay and Benefits (forthcoming) and links to other associated procedures. Please refer to section 8 of this procedure. 2. Risk Assessment/Health & Safety Considerations 2.1. Not applicable 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME 3. Procedure 3.1. Eligibility 3.1.1. The following members of staff are eligible: a) all permanently employed police staff provided that the permanent grade of their post is at least PO1, or has a maximum salary at least equivalent to the value of spinal column point 37 (maximum of PO1); b) permanently employed police staff designated Essential Users with permanent salary grades, of either SO1 or SO2 or equivalent; c) all police officers who qualify as ‘essential users’ (see Procedure 00320), complete in excess of 2,000 business miles per year and meet all other criteria (pro rata for part time officers). 3.1.2. Police Staff must also have successfully passed their probation to be eligible. 3.1.3. Eligible members of staff employed on a part time basis will receive a subsidy pro rata to contracted hours. 3.1.4. Applications are subject to the approval of the member of staff's Head of Department/OCU Commander and the Head of Financial Services/Director of Finance. Applications must be submitted with a signed copy of the letter which details additional conditions of the lease scheme. The application will not normally be approved if: a) a member of staff is on a temporary contract of employment or a fixed term contract for less than four years; b) a member of staff is under notice of redundancy; 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME c) the salary deduction calculated exceeds 25% of the member of staff's normal net pay; d) the member of staff has been disqualified from driving. 3.1.5. Queries on eligibility should be directed to the relevant Personnel Manager in the first instance. 3.1.6. The Constabulary reserve the right to refuse any application which may: a) be unacceptable to the Contract Hire Company, for whatever reason; b) be from an individual who is unacceptable to the Constabulary's insurers, or whose driving or claims history is such that their inclusion in the insurance policy may lead to an increase in premium. 3.2. Outstanding Car Loans And Disposal Of Existing Vehicle 3.2.1. A member of staff who intends to participate in the scheme and who has an outstanding car loan is given a maximum period of three months to dispose of the existing car and repay the outstanding balance of the loan. During this period normal car loan repayments will be made. At the end of three months, any outstanding balance will be recovered from salary. In any event, a car loan is repayable immediately on sale of the car for which the loan was granted. 3.3. Ownership Of The Car 3.3.1. The car remains the property of the Contract Hire Company and the member of staff must not attempt to sell the car, use the car as security for a loan, lead anyone to believe that he/she is the owner of the car or do anything that may infringe the Contract Hire Company's rights. 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME 3.4. Choice Of Car And Factory Fitted Options And Accessories 3.4.1. The Constabulary has no wish to unduly restrict a member of staff's choice of car, except to say that it must be suitable for business use, and be capable of running off either unleaded or diesel fuel. Additionally, drivers under the age of 25 are restricted to vehicles falling within insurance groups 1 to 9. Cars can be supplied with factory fitted options. Dealer fitted accessories, including towbars, may be ordered with the car and the cost included in the quotation; however such accessories remain the property of the Contract Hire Company. 3.4.2. Cars will be delivered to The Castle, Winchester. Drivers are required to produce their driving licence for inspection when collecting their vehicle. 3.4.3. After delivery a user may, through the County Treasurer, seek the permission of the Contract Hire Company to arrange for accessories to be fitted at the user's expense. Such accessories may be removed before return of the car provided that removal does not deface or devalue the vehicle. 3.4.4. When accessories remain fitted the additional cost of supplying these extras or their value will not be reimbursed to the member of staff at the end of the hire agreement. 3.4.5. The fitting of towbars after delivery is usually permitted but subject to Contract Hire Company written prior approval. Staff wishing to fit towbars should initially write to the County Treasurer who will make the necessary arrangements. The towbar should be fitted at a franchised dealership and the cost met by the member of staff. It should be noted that caravans/trailers etc. only have Third Party cover under the Fleet Insurance. Please see paragraphs 3.4.3 and 3.4.4 above regarding end of hire agreement arrangements. 3.4.6. No changes can be made to the car that may adversely affect its resale value. The car may not be modified or altered mechanically or have any parts removed, or accessories added without the written permission of the Contract Hire Company. 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME 3.5. Business And Private Use 3.5.1. Members of staff supplied with cars under this scheme are required to use them for all business travel. Exceptions are journeys to the Central London area, journeys where the car is inappropriate (e.g. a larger car is required) or where the use of public transport would result in a saving of member of staff's time or if otherwise directed by the member of staff's line manager. 3.5.2. The car must be available for business use at all times, except when being repaired or serviced. 3.5.3. Members of staff will be expected to travel by leased car rather than with a member of staff receiving essential or casual user allowances, unless otherwise directed by the member of staff's manager. 3.5.4. Members of staff should also use their leased vehicles for all training mileage and claim expenses at the appropriate lease car mileage rate. 3.5.5. The car may be used for private mileage but not used for any form of motoring competition or motor sport or be used regularly on unmade roads or rough grounds. 3.5.6. The member of staff must make the car available for inspection at any reasonable time by persons authorised by the Constabulary or the Contract Hire Company. 3.5.7. Returns of mileage claimed are required in all cases and may be made monthly or quarterly in respect of official journeys and petrol for business use reimbursed on a cost basis. The rate payable per mile is related to the petrol element of the Police Authority mileage allowances. The member of staff will also be required to provide the mile-o-meter reading on the claim. 3.6. Foreign Travel 3.6.1. Foreign travel is permitted subject to the prior written authority of the Contract Hire Company. The member of staff must apply to the County Treasurer, giving one month's notice, before departure from the UK, for a ‘Green Card’ (and the permission of the Contract Hire 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME Company) before undertaking foreign travel with the car. 3.6.2. Maintenance and repair cover is not available outside the UK and it is the member of staff's responsibility to ensure the return of the vehicle to the UK in the event of a mechanical failure or accident. Members of staff must therefore take out an appropriate foreign travel insurance (e.g. AA 5 star; RAC Eurocover) to ensure that the vehicle can be repaired overseas, or returned to the UK if repairs cannot be carried out in a reasonable period at an acceptable cost. 3.6.3. Reimbursement of unforeseen repair costs outside the UK is usually limited to UK price levels. 3.7. Maintenance Servicing And Repairs 3.7.1. The member of staff is responsible for ensuring that routine servicing is carried out at the intervals specified by the manufacturer and that other defects are dealt with promptly, particularly during the period of the manufacturer's warranty. A driver pack is supplied with the car which explains how servicing and repair work is authorised and members of staff are advised to familiarise themselves with the contents of the pack immediately after delivery. 3.7.2. The member of staff is expected to look after the car in the same manner as a reasonably prudent owner with responsibility, between services, for regularly checking and topping up the levels of oil, water, battery and brake fluid. The member of staff is also obliged to ensure that the correct antifreeze mixture is maintained, the tyre pressures are checked and the car is kept clean, protected and well cared for. Tyres should also be inspected regularly for signs of damage or uneven wear and steps taken to arrange rectification in accordance with the guidance set out in the driver pack. The cost of any repairs that arise from the negligence of the member of staff will be recovered from him/her. 3.7.3. All bodywork, interior and trim repairs that are not due to fair wear and tear, and not covered by an insurance claim are the responsibility of the member of staff. Failure to make good such repairs may result in a 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME charge from the Contract Hire Company to the member of staff at the end of the hire period. 3.7.4. The member of staff is required to ensure that the car's odometer (mile-o-meter) is kept in working order and must immediately inform the County Treasurer should a fault occur. Failure to do so, or any attempt to tamper with the odometer, may be considered to be a disciplinary matter. 3.7.5. The agreement includes servicing and mechanical repairs and service cover. Replacement of tyres, batteries, exhausts etc., is also covered provided that the repair or replacement results from fair wear and tear. Homestart, Roadside Assistance and Relay/Recovery facilities are also provided by the AA or RAC (depending on who supplies the car), however personal membership of a motoring organisation is not included. 3.7.6. The following are not covered in the agreement: a) repair/replacement charges in respect of light bulbs, damage to glass and lamp lenses (except where they are covered by an insurance claim); b) costs relating to premature tyre replacement resulting from abuse, excessive wear, impact damage or punctures, however caused. 3.7.7. When it is necessary for tyres, batteries, brake linings or exhaust systems to be renewed the supplier will obtain authorisation from the Contract Hire Company on production of the credit authorisation card supplied with each vehicle. Members of staff must ensure that the Contract Hire Company is willing to meet the cost of replacement before allowing the work to be carried out. Failure to obtain this agreement could lead to the Contract Hire Company recharging the Constabulary and therefore the member of staff if the replacement is deemed to be premature. The cost of such repairs or replacements which fall outside the maintenance agreement should be paid for by the employee when collecting the vehicle. 3.7.8. In the event of windscreen/window replacement, members of staff should only use the Autoglass card 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME supplied with each vehicle as the use of other companies could incur the Constabulary in extra cost which in the event will be recovered from the member of staff. Whenever possible, repairs should be carried out during normal working hours. 3.7.9. Any credit authorisation card supplied by the Contract Hire Company may only be used for repairs and maintenance for the car supplied. The members of staff will be liable for any charges improperly incurred and improper use may be considered to be a disciplinary matter. 3.8. Replacement Vehicle 3.8.1. The annual contract hire does not include a replacement vehicle in the event of the lease car not being available due to routine servicing, mechanical failure, accident damage or total loss arising from theft or write off. 3.8.2. The County Treasurer will be pleased to provide terms for the cost of a replacement vehicle to be supplied in the above circumstances on request. This provision is optional. 3.8.3. Members of staff should note that the time period after which a replacement car will be available, i.e. 24 hours, 48 hours, commences when the request is made to the Contract Hire Company and not when the original car becomes unavailable. 3.9. Payment For The Car 3.9.1. The annual cost of contract hire and insurance will be met by: 3.9.2. The Constabulary's Contribution a) For police staff a fixed annual contribution is paid according to the substantive post salary (a temporary upgrade will not incur additional contribution). Current subsidy levels are set out in Appendix A. b) For all police officers, an alternative is used to calculate a subsidy based on the scale of 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME allowances for essential users. In this case an assessment is made at the beginning of the year of the value of his/her estimated business mileage for the following 12 months. If the estimated figure proves to be higher than the actual business mileage then the difference between the estimated and the actual calculation will be recouped from the lease at the end of each financial year. This will include instances where business mileage changes due to post changes. Therefore police officers need to consider the implications of a change of post. c) The scale of essential user allowance, i.e. lump sum and mileage element will be calculated net of the cost of petrol (i.e. net of leased car rate) which will be reimbursed separately on a claims basis. d) The estimated annual business mileage should not be exceeded as this also impinges on lease payment calculations for which an officer would be liable. In this respect, it should be noted that for police officers, para 3.5.1 does not prohibit the use of police vehicles, if to do so would achieve a better utilisation of the force vehicle fleet. e) In all cases the Constabulary's contribution will not exceed the cost of contract hire plus insurance. f) Part time staff will be entitled to receive a proportion of the fixed contribution per month in the same ratio as the number of contracted hours bears to a full time appointment. 3.9.3. The Member of Staff's Contribution a) The difference between the Constabulary's contribution and the annual cost of contract hire and insurance plus VAT will be the member of staff’s contribution. 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME b) Mileage claims will still be made and petrol used for business mileage and relocation mileage during the support period will be reimbursed on a cost basis, i.e. the fuel element included in the mileage allowance (leased car rate). A list of current rates is shown in Appendix B. 3.9.4. The member of staff's contribution will be collected by deduction from salary. 3.9.5. As the annual contract hire cost is calculated by the Contract Hire Company with reference to the projected mileage over the four year contract, it is important that care is taken to estimate, as accurately as possible, the annual business and private mileage. 3.9.6. Business mileage does not include additional mileage arising from relocation. Such mileage should be shown separately on the application form so that the additional annual rental cost arising during the period of support can be identified and allowed for in the Constabulary's contribution. 3.9.7. Business mileage can be defined as the mileage a member of staff travels in the performance of his/her duties and is as such reimbursed as part of a casual/essential car user's allowance. Consequently, training mileage and mileage travelled as a result of redeployment should be detailed separately. Mileage to and from a member of staff's place of work is regarded as private mileage. 3.9.8. Members of staff should note that there is a tendency for cars supplied under the scheme to be driven more frequently and projections should take account of this. 3.10. Excess Mileage 3.10.1. If the total mileage is exceeded at the end of the contract, excess mileage charges will be levied by the Contract Hire Company. Excess mileage relating to private usage will be recharged to the member of staff. 3.10.2. The charge for each excess mile ranges from 2p to 10p, depending on the size of the car and the company supplying the car. 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME 3.10.3. The County Treasurer will not normally renegotiate the rental agreement with the Contract Hire Company unless the difference between the estimated and actual private mileage is substantial, i.e. at least 1,000 miles per annum difference. In cases where a significant excess private mileage charge is accruing, application may be made in writing to the County Treasurer who will, if necessary, make arrangements to collect the excess over the remaining months of the contract in order to avoid a considerable excess private mileage charge falling due at the end of the contract. 3.11. What The Member Of Staff Pays 3.11.1. In addition to the member of staff's contribution the following charges may arise and are recoverable from the member of staff: a) increases in road fund licence and VAT will be recovered by amending the monthly deduction from pay as will any cost incurred as a result of legislation; b) charges arising from the following will be deducted from pay, or by agreement will be invoiced: i. any accidental damage excesses deducted from insurance claims; ii. repairs resulting from negligence or repairs carried out outside the UK or deemed to be outside the maintenance agreement; iii. any fines etc. arising during the period of the agreement for breaches of road traffic regulations are the responsibility of the member of staff and if they are not paid promptly may be paid by the Contract Hire Company and recovered from the member of staff together with an administration charge, such fines will be paid by the Constabulary on demand; 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME iv. any charges the Constabulary incurs because the members of staff failed to carry out the instructions or authorisation procedures specified in the Contract Hire Company's driver instruction book/handbook; v. settlement figures arising from prior termination, see Section 3.17; vi. any charges for damage or excess wear and tear during or at the end of the agreement; vii. any charges for excess mileage at the surrender of the vehicle; viii. any costs the Constabulary or Contract Hire Company incur in recovering the vehicle if it is not returned to The Castle on expiry or termination of the agreement. 3.11.2. In default, deductions will be made from the member of staff's salary or from other sums due to the member of staff from the Constabulary. 3.12. Change Of Circumstances 3.12.1. If an officer is transferred, for any reason, during the currency of the lease to a post which is not eligible for vehicle user allowances, she/he will become responsible for either the full cost of the continuation of the lease or a settlement figure determined by the Contract Hire Company to cancel the hire. 3.12.2. If a change of post results from redeployment, ill health or other exceptional circumstances, the Head of Department/OCU Commander, after consultation with the Head of Personnel and Director of Finance may agree that the terms of the existing agreement continue. 3.12.3. If a member of staff becomes disabled during a car lease contract period and as a result needs to end their lease contract (as they can no longer drive for example) or change vehicles for one which is more 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME suitable, then the Head of Personnel, in consultation with the Director of Finance, will consider the case, the cost to the Constabulary and whether any reasonable adjustments can be made to the contractual obligations of the member of staff, with regards to payment of early redemption costs or other charges related to ending/ changing the lease agreement. 3.12.4. For members of staff entitled to maternity leave the following options will apply: a) Option 1: The subsidy will remain unaltered throughout the period of maternity leave. b) Option 2: The member of staff may return the car at no penalty at the commencement of maternity leave. 3.12.5. In the event of the member of staff electing for Option 1 above and subsequently not returning to work, the contract shall be deemed to have ceased at the date of expected return to work and normal prior termination penalties will apply. In exceptional circumstances the Head of Personnel, in consultation with the Director of Finance, may agree to meet all or part of these charges. In such circumstances, the member of staff must return the car to the County Treasurer without delay. 3.12.6. These options are also set out in the attached file. 3.12.7. Members of staff on Career Breaks and unpaid leave in excess of one month will need to return the vehicle when the career break/unpaid leave commences. The member of staff will be responsible for meeting all charges levied by the Contract Hire Company including the early termination charge. 3.13. Insurance 3.13.1. Comprehensive insurance will be arranged by the Constabulary on a fleet motor policy. This insurance carries very limited cover for personal effects and members of staff are advised to ensure that their home contents insurance carries adequate cover for loss of personal effects from the vehicle. 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME 3.13.2. The premium will be based on the insurance group of the vehicle and the age of the member of staff. 3.13.3. Current insurance premiums are shown in Appendix D with details of policy excesses. 3.13.4. Members of staff are required to complete an insurance declaration covering themselves and, where applicable, their partner. Other members of the member of staff's immediate family normally resident with him/her may be added to the list of authorised drivers but an insurance declaration must be completed and approved beforehand. 3.13.5. The Policy only relates to the leased vehicle, and does not provide any cover for the member of staff or other named drivers when using any other vehicle. 3.13.6. The Constabulary reserves the right to withdraw leasing availability or to substantially increase the insurance excesses and premiums if, in the opinion of the Insurer and/or the County Treasurer and County Secretary, the member of staff's claim or driving record warrants such action. 3.13.7. An incident which may give rise to an insurance claim and any motoring conviction against the member of staff or any named driver must be immediately and fully reported to the County Treasurer. If the driver is disqualified from driving, the County Treasurer may withdraw the leasing availability in which case the vehicle must be returned to The Castle immediately and the lease will be terminated (see 3.17 Prior termination of hire agreement). All insurance repair work should be carried out in accordance with advice from the County Treasurer when an incident is reported. 3.14. Uninsured Losses 3.14.1. The policy does not provide for the recovery of uninsured losses, e.g. policy excesses, car hire etc. It is the sole responsibility of the member of staff to pursue recovery from the third party. 3.14.2. The policy specifically excludes the costs of claims associated with the theft of vehicles where the car has 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME been left unattended but with the keys inside the vehicle. 3.14.3. In cases where the Authority itself incurs an uninsured loss, for example uninsured termination charges arising from a write off or theft etc, the Constabulary reserves the right to pursue any negligent party. 3.15. Personal Accident Cover 3.15.1. Although the Constabulary operates a Personal Accident Scheme whereby members of staff may recover certain costs if they were actually on duty at the time of the accident, the fleet insurance does not in itself include any personal accident cover. Members of staff are therefore advised that if they wish to include such cover, i.e. for injuries sustained on private mileage where no other party was negligent or injuries outside of the scope of the Constabulary's Personal Accident Scheme, they should make their own arrangements. 3.16. Taxation 3.16.1. Cars provided by the Constabulary under the scheme are available for private use and therefore are of "benefit" to the member of staff. From 6 April 2002 the "benefit" has been calculated as a percentage of the full manufacturers list price of the vehicle plus taxes, delivery charges and accessories. The percentage applied is defined by the CO2 emissions of the vehicle. The table below shows the CO2 emissions and their current related percentage charge. Grams per Percentage of Diesel Supplements km car’s price taxed 120 10 Add 3% if car runs solely on diesel 1 135 15 Add 3% if car runs solely on diesel 1 140 16 Add 3% if car runs solely on diesel 1 145 17 Add 3% if car runs solely on diesel 1 150 18 Add 3% if car runs solely on diesel 1 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME 155 19 Add 3% if car runs solely on diesel 1 160 20 Add 3% if car runs solely on diesel 1 165 21 Add 3% if car runs solely on diesel 1 170 22 Add 3% if car runs solely on diesel 1 175 23 Add 3% if car runs solely on diesel 1 180 24 Add 3% if car runs solely on diesel 1 185 25 Add 3% if car runs solely on diesel 1 190 26 Add 3% if car runs solely on diesel 1 195 27 Add 3% if car runs solely on diesel 1 200 28 Add 3% if car runs solely on diesel 1 205 29 Add 3% if car runs solely on diesel 1 210 30 Add 3% if car runs solely on diesel 1 215 31 Add 3% if car runs solely on diesel 1 220 32 Add 3% if car runs solely on diesel 1 225 33 Add 3% if car runs solely on diesel 1 230 34 Add 3% if car runs solely on diesel 1 235 35 Add 3% if car runs solely on diesel 1 240 35 Add 3% if car runs solely on diesel 1 3.16.2. Where a diesel vehicle which meets the Euro IV emissions standard is registered by the 31st December 2005 it will not be subject to the Diesel Supplement. 3.16.3. If the vehicle is registered before the 31st December 2005 and does not meet the Euro IV emissions standard it will be subject to the Diesel Supplement. 3.16.4. If the vehicle does meet the Euro IV emissions standard but is first registered on 1 January 2006 or later it will be subject to the Diesel Supplement. 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME 3.16.5. Note that the minimum and maximum percentage charges are 15% and 35% respectively. 3.16.6. All price / cost quotations provided by the our contractor, Hampshire County Council (HCC) will include an assessment of the likely income tax cost of leasing any particular vehicle. This estimate will be based on the information available at the time and does not represent a binding offer. It should be noted that the actual income tax payable on the leased vehicle is calculated at the member of staff’s personal marginal rate. Any differences between the actual rate used to calculate the `benefit’ and that provided by HCC for quotation purposes is the responsibility of the member of staff. 3.16.7. Examples of the calculation are set out in Appendix E. 3.16.8. Where the member of staff makes a contribution towards the financing of the car that contribution is used to offset the ‘benefit’ and reduce the member of staff's liability to tax. The maximum amount of such an offset is a sum equal to the car benefit. Therefore, in some cases, the member of staff's contribution may equal or exceed the cash equivalent resulting in no tax liability. Such contributions are deemed to be in respect of the vehicle being available for private use. Such contributions are deemed to be in respect of the vehicle being available for private use. 3.16.9. Essential users will be aware that their existing allowances are in some instances the subject of a tax assessment. Members of staff opting for a leased car will no longer be liable to tax under these arrangements and the Inland Revenue will be informed, so that the year's assessment may be correctly apportioned between the two ‘schemes’. 3.17. Prior Termination Of Hire Agreement 3.17.1. Unless otherwise agreed the car is provided for a fixed four year period and if the agreement is prior terminated by either party for any of the following reasons: a) the termination of the member of staff's employment with the Constabulary, 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME whether by voluntary resignation, retirement or dismissal; b) the member of staff being disqualified from driving a car; c) the member of staff breaches the terms of the scheme; d) the member of staff is transferred, for any reason, during the currency of the lease to a post which is not eligible for a leased vehicle. 3.17.2. The member of staff is liable for: a) a settlement figure determined by the Contract Hire Company to clear the vehicle from their books and so end the relationship with the Constabulary as hirer. This figure will not exceed 50% of the annual rental plus VAT; b) a reimbursement of the Constabulary's advance payment of annual rental plus insurance in respect of the period from the date of termination to the end of the year, i.e. for a car hired on 1 January the Constabulary would have paid the full annual cost in advance so that termination on 30 September would require reimbursement of three twelfths of the annual rental. 3.17.3. Examples of the calculation are set out in Appendix F. 3.17.4. The Constabulary may, at the discretion of the Head of Personnel, after consultation with the Director of Finance, meet all or part of the settlement figure where prior termination of the agreement is as a result of: a) ill health retirement; b) redundancy or retirement in the interests of efficiency of the service; c) disqualification from driving on health/medical grounds; d) death of the member of staff. 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME 3.17.5. The underlying intention of this scheme is to improve the recruitment and retention of staff. Where prior termination arises within the first two years of the first agreement as a result of the member of staff's voluntary resignation or retirement (not redundancy or retirement on grounds of ill health), the whole or part of the fixed annual allowance becomes payable. 3.17.6. The sum repayable is equivalent to the difference between Police Authority travelling allowance and the fixed allowance, up to a maximum of one year's difference, i.e. the Constabulary's contribution and the amount the member of staff would have received by way of travelling allowances. 3.17.7. This sum is in addition to any payment under 3.17.1 above. 3.17.8. If the car is stolen, or is considered to be beyond economic repair by the Constabulary's insurers following an accident (a ‘write off’) or uneconomic to maintain by the Contract Hire Company the Constabulary reserves the right to substitute the car with one of as near equal age and specification as practicable. Members of staff should be aware that, in the case of stolen cars, the contract and payments continue until the leasing company has received full and final settlement from the insurers. 3.17.9. If the member of staff is taking up employment with another employer that operates a car scheme, it may be possible to transfer the existing vehicle to that scheme. In these circumstances, and provided that no loss occurs then no termination figure will be payable, but the penalty for termination within 2 years under 3.17.3 remains. 3.18. End Of Hire Agreement And Surrender Of Vehicle 3.18.1. At the end of the agreement period, or on prior termination, the car must be returned to The Castle, Winchester. Failure to return the vehicle, without good reason, may lead to the Constabulary incurring an additional hire cost which will be recovered from the member of staff. Failure to return the car may also be considered to be a disciplinary matter. 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME 3.18.2. The member of staff is responsible for returning the vehicle in a good and clean condition. The member of staff is responsible for and will be required to meet the cost of: a) rectification of any defects in the bodywork, interior or trim of the vehicle which the Contract Hire Company does not consider to have resulted from fair wear and tear; b) the cost of replacing any missing equipment or accessories; c) making good any damage caused by fitting or removing other accessories. 3.18.3. Normal use does not give rise to an additional charge and fair wear and tear is related to the vehicle's mileage. Fair wear and tear includes superficial scuffs and repaired stone chipping of the bodywork. However, bodywork dents, scratches that have broken the surface of the paintwork to reveal undercoat or metal, damage to the interior trim and tears in upholstery, count as excess wear and tear and are the subject of a rectification charge. Cracked or damaged glass, mirrors and lenses are subject to recharge. 3.18.4. On surrender, the Constabulary will use its best endeavours to ensure that the company offers to sell the car to the member of staff or to the member of staff's nominee. This will give the member of staff (or nominee) 'first refusal' to purchase the car. The price of the vehicle will be strictly a matter between the Contract Hire Company and the member of staff. If the purchase takes place before the expected contract end date, prior termination charges are payable in accordance with these terms and conditions. 4. Roles & Responsibilities 4.1. Staff are responsible for: a) Complying with the terms and conditions of subsidised car leasing. b) Using the car supplied under the scheme for all business travel, including training. 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME c) Claiming expenses at the appropriate lease car mileage rate. d) Ensuring the car is available for inspection at any reasonable time. e) Applying for a ‘Green Card’ in the event of foreign travel. f) Ensuring all servicing is carried out and that other defects are dealt with promptly. g) Ensuring the car is looked after and maintained. 4.2. Heads of Department/OCU Commander’s are responsible for: a) Approval of member of staff’s application. b) Considering after consultation with the Head of Personnel if terms of existing agreement should continue if a post changes as a result of redeployment, ill health or another reason at the management’s instigation. 4.3. Director of Finance/Head of Financial Services a) Approval of member of staff’s application. b) Considering after consultation with the Head of Personnel to meet all or part of the charges occurred following a period of maternity leave. c) Considering after consultation with the Head of Personnel whether to meet all or part of the settlement figure where prior termination of the agreement is as a result of: i. ill health retirement; ii. redundancy or retirement in the interests of efficiency of the service; iii. disqualification from driving on health/medical grounds; iv. death of the member of staff; 4.4. County Treasurer 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME a) Approval of member of staff’s application. b) Reserves the right to refuse applications. c) Provide price/cost quotations. 4.5. Personnel Managers a) Provide advice on eligibility. 5. Administration 5.1. Applications for leased cars to be made by staff to the OCU Commander/Head of Department. 5.2. If approved application forwarded to the Director of Finance for final approval, accompanied by a signed copy of the ‘additional conditions’ letter (hyperlink to letter in MS Word). 5.3. If approved application will then be forwarded to the Car Leasing Section of Hampshire County Council who will make arrangements direct with the member of staff for lease of the vehicle. 6. Monitoring/Evaluation 6.1. It is the responsibility of the Head of Personnel to monitor and ensure the effective operation of this procedure. 7. Review 7.1. This procedure will be reviewed annually to ensure its continuing relevance and effectiveness. 8. Linked Procedures, Policies & Information Sources 8.1. 24000 Policy – Pay and Benefits (forthcoming) 8.2. AD203 – Equality Impact Assessment Origin: Personnel 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME 1. Appendix A 1.1 Hampshire Constabulary’s Contribution - As At June 2004 Monthly Annual Contribution Equivalent £ £ ACPO ACPO ACPO HM Grades ‘A’ to ‘F’ (where not 217 2610 ACPO) PO Grades 3 and 4/HMG ‘G’ 171 2052 PO Grades 1 and 2 146 1754 SO Grades 1 and 2 (Essential Car Users only) or deemed equivalents 1. Appendix B 1.1 Mileage Rates As At 01/04/04 1.1.1. Please see the Force Intranet 1. Appendix C 1.1 Options For Maternity Leave 1.1.1. See Attachment 1. Appendix D 1.1 Insurance 1.1.1. A fleet motor policy has been arranged with Royal Insurance UK Limited. The premium payable is determined by the Insurance Grouping of the car and the age of the employee as follows: Annual Premiums 2000/2001 Age Insurance Group 1-6 7-9 10-11 12-15 16-20 £ £ £ £ £ 30 and over 347 393 443 515 730 28 and under 30 399 452 509 593 839 25 and under 28 416 472 532 618 876 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME 21 and under 25 520 591 These cars are Under 21 756 858 not available 1.2 Policy Excesses 1.2.1 Generally, the employee and other drivers nominated by the employee to drive the car will be responsible for the first £100 of any claim, including theft, but there are higher excesses for second and subsequent claims within a contract period and for young and inexperience drivers. The full table is as follows: Drivers age at 25 years and over 21-24 years Less than 21 years time of incident £ £ £ First claim 100 200 300 Second claim 175 275 375 Third and 250 350 450 subsequent claim 1.2.2 NOTES: a) Where the driver is the holder of a provisional licence or has held a full licence for less than one year a loading of 150% of the above values will apply. b) Each windscreen or window glass replacement carries a £50 excess and will not county towards the above stepping process. 1.3 Uninsured Losses 1.3.1 The policy does not provide for the recovery of uninsured losses, e.g. policy excesses, car hire etc. It is the sole responsibility of the officer to pursue recovery from the third party. 1. Appendix E 1.1 Personal Tax Implications 1.1.1. Cars provided by the Constabulary under the scheme are available for private use and therefore are deemed to be of “benefit” to the member of staff. From 6 April 2002 HMRC have quantified this benefit and expressed it as a percentage of the vehicle’s full list price 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME plus taxes, delivery charges and extras. The percentage charge is based on the CO2 emissions of the car as previously described. An example of the calculation List Price of Car (Petrol Engine) £15,000 CO2 = 175gms = 23% £3,450 Car Benefit Charge Less: Employee contribution for £ 900 private use Taxable Benefit £2,550 Tax @ 20% £ 510 Tax @ 40% £1,020 List Price of Car (Diesel Engine) £15,000 CO2 = 175gms = 26% (23% + £3,900 Car Benefit Charge 3%) Less: Employee contribution for £ 900 private use Taxable Benefit £3,000 Tax @ 20% £ 600 Tax @ 40% £1,200 1.1.2. The Inland Revenue will collect tax due on the car benefit at the member of staff’s personal rate by adjusting the personal tax code applied to their salary. 1.1.3. Notes: a) The benefit is proportionately reduced if the car is not available for part of the year. b) Members of staff earning less than £8,500 per annum will have no liability arising from the provision of a car. (The car benefit is treated as earnings for the purposes of calculating total annual earnings.) 1. Appendix F 1.1 Prior Termination Calculation 1.1.1. Prior termination charges are payable by the member of staff in the circumstances outlined in paragraph 16.1 of the Terms and Conditions. The amount payable is dependent upon the age of the vehicle and is expressed in terms of a proportion of the annual rental as invoiced to the Constabulary by the Contract Hire Company. The charges are as follows: 24004 PROCEDURE - SUBSIDISED CAR LEASING SCHEME Termination in: Additional Termination Charge First six months 12 months’ annual rental Months 7-12 10 months’ annual rental Months 13-24 6 months’ annual rental Months 25-36 4 months’ annual rental Months 37-48 2 months’ annual rental 1.1.2. Therefore, if a vehicle with an annual rental of £2400 pa was prior terminated in the second year of the contract, the early termination charge payable by the member of staff would be £1200 (i.e. 50% of £2400). Termination charges also attract VAT at the standard rate.
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