Five years after its introduction, we are seeing a rising number of employees who are leaving their company car at home and opting for the mobility budget. What makes this option rewarding for both employees and employers and how do you go about it?
The mobility budget was created on 1 March 2019 to give employers and employees maximum flexibility in the way people undertake their workplace travel. The main reason was to drive down the number of commercial vehicles in our country. Which is how 2.2% of employees traded in their company car for a mobility budget last year: double the previous year’s figure.
In spite of the upward trend, the number of employees who actually opt for a mobility budget still remains relatively limited. One reason being that not all companies offer the option yet, although there is definitely heightened interest. Also, the calculation formula has recently been given an official look, making it much easier for companies to calculate the annual mobility budget.
How exactly does the mobility budget work and why is it so rewarding to offer your employees? The thing is that the budget provided for a company car (total cost of ownership) remains available to the employee. Only, it is used in a different manner: more sustainable, more efficient and tailored to the employee’s needs. How can this budget be spent then?
Recent figures show that pillar two (housing) is especially widely liked, with 77% of the total volume spent on housing last year. Think interest, rent and mortgage. After housing costs, most of the budget goes to bicycles, purchase as well as subscriptions.
Gone are the days when employees, especially young people, chose a company car by default. This is an important signal for employers who want to (continue to) attract talent in a tight labour market. In terms of remuneration, the company car is simply no longer the best choice and it is wise to re-assess the options in terms of flexible remuneration. We also live in a world that is gradually becoming more sustainable and where this factor also plays a major role in the decisions of (prospective) employees. So setting up a mobility budget only gives you advantages as an employer:
Looking for a mobility budget that automatically communicates with payroll processing? Or are you looking for assistance with preparing your plan? Acerta Consult is on hand to get you started.
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