Organisations within the public sector are being advised to consider taking a leaf out of the books of proven fleet solutions rather than simply cutting mileage rates in a bid to save funds, according to fleet funding company Alphabet. Moves by public sector organisations to slash mileage are being called a "knee-jerk reaction" by Clive Buhagiar, head of public sector at Alphabet. Mr Buhagiar uses the case of North Lincolnshire Council which plans to save £600,000 by dropping its staff mileage rate from 52p to 45p _ the current HMRC-approved level. Buhagiar claims the public sector is not fully exploring the other avenues available to them that could help cut costs even further, whilst "supporting their desire to remain responsible employers." "If we take the headline £600,000 saving and divide this by 7p per mile, this gives us the figure of 8,571,429 (the number of business miles reclaimed every year)," he said. "If we multiply this mileage by 45 pence per mile (new rate), this gives us a cost of £3,857,143 fuel cost for their 'grey fleet', assuming this is over a three year cycle. "If they had switched to a typical diesel pool car fleet (sub 1600cc), the HMRC rate is 12p per mile, giving a fuel cost of £1,028,570, based on 8,571,429 miles. "If we then assume a £2,000 rental per year and base this on 100 cars, this comes to a total hire cost of £600,000 over three years. "Assuming an insurance cost of £600 per car per year, this comes to £180,000 over three years, making the total cost of the pool car fleet over the period, £1,808,570. "This gives us a saving of approximately £2 million over the 'grey fleet' choice every three years." Some councils have successfully altered travel plans within their organisation, just by holding an increasing number of tele or video conferences and by travelling to meetings by public transport or walking. Is your organisation looking to maintain efficiencies for its vehicle fleet? With our industry leading vehicle refurbishment and fleet appraisal facilities why not get in touch with us today at IT Fleet Automotive and see what we can do for you.