Up to a third of new cars bought in parts of the UK last year were paid for by the taxpayer and given to people on benefits, new figures show.

The Motability scheme allows disability welfare claimants to swap their mobility allowance for a lease on a new car, which are also exempt from VAT and insurance premium tax.

While many disabled people rely on Motability cars to get around, the perk has been criticised for allowing those with more minor conditions such as anxiety or depression to claim taxpayer-funded cars.

Now, new statistics uncovered by the Conservative Party show that some 277,645 new cars bought in England and Wales in 2024-25 were via the Motability scheme.

While that constitutes 16 per cent of all car sales overall – or one in six – in some parts of the UK the figures are much higher.

In Wales, 33 per cent of new cars sales were made through the scheme, followed by 26 per cent in the North East and 24 per cent in London.

Tory leader Kemi Badenoch told The Sun: ‘Welfare isn’t working.

‘Instead of a system where those who genuinely need support can access it, we have created one where it is all too easy to abuse the generosity of hardworking people.’

The Motability scheme allows disability welfare claimants to swap their mobility allowance for a lease on a new car. Pictured: Chancellor Rachel Reeves

The criticism comes after BMW and Mercedes cars were removed from Motability last month after Rachel Reeves said it was ‘unfair’ to lease luxury models to benefits claimants.

The scheme announced it will ‘immediately’ stop offering the luxury brands, in addition to vehicles made by Audi, Alfa Romeo and Lexus.

Currently, 85 per cent of claimants make additional payments to get better models.

And out of the 300,000 vehicles currently leased through the scheme each year, only 10 per cent are wheelchair adapted.

Ms Reeves previously shared concerns that Motability was offering ‘a premium motoring experience subsidised by the taxpayer’ that was out of reach to many working families.

The switch means Motability claimants currently driving BMWs and Mercedes will have to move to another brand next time they change vehicles under the scheme.

Motability has vowed to increase their use of UK-made cars and aims for 2035 to be the first year that half of the vehicles leased through the scheme are British.

Figures show nearly ten per cent of people in parts of the UK are entitled to lease a vehicle through the initiative.

Among those eligible for the initiative are people receiving an enhanced rate of the mobility component of the Personal Independence Payment (PIP), which is intended to help with the extra costs of living with a disability or health condition.

These PIP claimants can choose to swap a portion of their payments for a new car, scooter or powered wheelchair.

Research by the Daily Mail previously revealed the ten areas in England and Wales with the highest proportion of people in receipt of enhanced PIP who could be entitled to claim for a vehicle.

Blaenau Gwent in south-east Wales came top, with 7.4 per cent (4,999) of local people receiving the benefit.

Seven other areas in the top ten were also in Wales, while Knowsley on Merseyside came fifth with a claim rate of 6.2 per cent.

Blackpool came tenth, with 5.6 per cent of residents (8,112) on enhanced PIP.

A Labour spokesman said: ‘This Government is already taking tough action to reform the Motability scheme.’

A spokesperson for Motability previously said: ‘The Motability Scheme exists to meet the needs of disabled people – giving them the freedom to get to work, attend school, medical appointments, and live independently.

‘The Scheme is not only life-changing for customers but delivers real value to the UK economy – generating £1.50 in economic benefit for every £1 of disability allowance spent.

‘It operates fully off the UK Government’s balance sheet, with no additional direct funding from the taxpayer beyond the allowances provided to disabled people.’