Grey fleet mismanagement costing millions

17 October 2008

A best practice guide for public sector bodies has warned that grey fleets could be wasting millions of pounds a year and increasing accident risks.

Public sector employees travel an estimated 1.4 billion miles a year on business in grey fleet vehicles, accounting for 57% of public sector mileage, the report reveals.

The report warns that the average age of a public sector grey fleet car is 6.7 years, which would typically have emissions 27% higher than a new vehicle.

And it says that that using grey fleet vehicles could cost more than safer alternatives, raise the risk of accidents and create more pollution if they are not properly managed.

Alternatives identified include rental vehicles and public transport.

The Grey Fleet Best Practice Guide was published by the Office of Government Commerce this year and was developed by the Grey Fleet Stakeholder Forum, as part of the fleet collaborative pilot, looking at fleet management best practice in the public sector.

Ten government departments contributed, including the Department for Transport, Met Police, NHS Purchasing & Supply Agency, HM Revenue & Customs and Department for Work and Pensions.

The report warns: “Often, grey fleet is not the most cost effective method of transport available to an employee, but may be preferred for a range of reasons.

“The employee may not be aware of alternatives, effective journey planning may not be undertaken or in some cases, the mileage rates offered by departments may act as an incentive for people to drive their own vehicles.

“Without appropriate demand management, this can lead to rising mileage in employee-owned cars, as well as rising mileage costs.”

Most central civil government departments pay grey fleet drivers the standard Approved Mileage Allowance Payments (AMAP) rate of 40 pence per mile for the first 10,000 miles and 25ppm for additional mileage, although some pay up to 81ppm.

Research revealed that the cost of a grey fleet driver making a 240 mile round trip between London and Bristol would cost £96, compared to £49 by public transport, £60 in a hire car and £76 in a lease car.

The report added: “The management of grey fleet travel plays an important part in supporting three key policy areas of health and safety, environmental sustainability and financial efficiency.

“It is about removing unnecessary mileage and transferring travel to more environmentally-efficient and cost effective alternatives like public transport and hire cars, as well as minimising the risk where employees do use grey fleet for work.”

Last week, Graham Feest, a road safety consultant and secretary of the Association of Industrial Road Safety Officers (AIRSO), said public sector bodies were not meeting their duty of care to grey fleet drivers.

He singled out blue light fleets, saying that while they manage their own blue-light vehicles well, when it comes to managing their grey fleet they are “appalling”.

This article, which appeared in Fleet News, can be seen online by clicking here.

RoadSafe strongly supports the need for organisations to actively manage their employees who drive for work and the vehicles they use. Good management practice has been shown to have a positive effect on incident reduction and significant financial benefits can also be acheived.

Furthermore, RoadSafe firmly advocates the sharing of best practice between organistions to catalyse a reduction in the number of road casualties on a wider scale. Indeed, this concept lies at the core of the Driving for Better Business programme.