Fleet & Plant Management

Vehicle Leaseback & Commuter Use

  • 1.  Vehicle Leaseback & Commuter Use

    Posted 24 May 2020 22:58
    ​Hello,

    After feedback on fee structures in place within other organisations regarding staff accessing vehicle leaseback and commuter use.
    we currently have a robust fee structure for leaseback to fully offset FBT obligations only. we have 5 leaseback classes based on gross purchase price, with 1 - 4 having a fee to offset the maximum possible FBT for each, and class 5 being actual. they are;
    Class 1 <= $25k
    Class 2 $25001 to $28000
    Class 3 $28001 to $32000
    Class 4 $32001 to $36000
    Class 5 vehicles are those that are negotiated with the employee which exceed the operational requirements of the organisation.

    My concerns with our processes are;

    We don't have a fee structure, or procedural guidelines, to manage private km and have some vehicles exceeding 40000km/year. if you looked at leaseback as a business unit the reality of this vehicle usage would be the low end users supporting the high end users.

    We also have several vehicles that have a home to work travel arrangement, with no operational benefit or requirement to do so, and no fee structure to offset associated costs.

    Appreciate any feedback on your processes, and thoughts on ours.​

    Regards
    Stuart.

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    Stuart Sturgeon
    Fleet Manager
    Snowy Monaro Regional Council
    NSW
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  • 2.  RE: Vehicle Leaseback & Commuter Use

    Posted 25 May 2020 20:55
    Hi Stuart
    Griffith City Council uses the model that was produced by LGSA, NSW,   "Guidelines for Providing Cars"  which provides a methodology to calculate lease rates. The methodology references the state government document Executive and Non Executive "Salary packaging motor vehicle charges which is updated every year.  So basically the calculations take into account the following:  Purchase price, Finance costs, Depreciation, Registration and Insurance. to come up with a total fixed cost.  Then reference the Salary Packaging Motor Vehicle Charges and it will provide a cents per kilometre for operational costs for a variety of vehicle categories.  ( an estimate must be made of annual Km travelled) Add the fixed costs to the to operational costs  to come up with a total cost.  Then apportion the percentage of private use to come up with a lease fee.  The methodology also gives the option to fully recover FBT





    Steve Croxon
    Plant and Depot Manager
    p 02 6962 8289 | m 0407 281 023

     

     


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  • 3.  RE: Vehicle Leaseback & Commuter Use

    Posted 27 May 2020 00:43
    Hi Stuart

    We are currently analysing the financial implications of leaseback and our landscape seems similar to yours.

    We would be very interested in seeing your fee structure.   At present we are brainstorming and it would be very good to see what another Council is doing.

    At this time we a trying to find a electronic means of gathering work/private use allocation.  Without logbooks, but with with GPS trackings, its remains tricky !

    Regards
    Merle Westendorp
    Fleet Manager
    fm@narrabri.nsw.gov.au
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  • 4.  RE: Vehicle Leaseback & Commuter Use

    Posted 28 May 2020 01:04
    ​Hi Stuart

    There are many methods, however a consideration/starting point for basic lease fee structure should be how much your Council is prepared to pay as an annual 'contribution' towards WOL costs and FBT of the lease vehicle.
    Once this is established the hire rate can be calculated.
    The smaller/cheaper the vehicle, the lesser the lease fee will be as the council contribution doesent change - an incentive for officers to take up the smaller vehicles listed in the vehicle list.

    Tom
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