ORGANISERS of a charity for the disabled last night denied that they

were on a ''nice little earner'' at the taxpayers' expense.

The National Audit Office is carrying out a routine investigation of

the disabled drivers' charity, Motability.

The charity's chairman, Lord Sterling, said it had nothing to hide. It

provided a valuable service to hundreds of thousands of disabled people.

However, the Social Security Secretary, Mr Peter Lilley, has told the

organisers that they should be fighting for the best value for money for

their customers.

Motability will today hand over the keys of its 500,000th vehicle to a

disabled driver at a Downing Street reception being given by Mr Major.

The charity, through its financial arm, Motability Finance Ltd,

provides leased and adapted cars to disabled drivers, who in return hand

over their weekly #32.65 disability living allowance.

Some disabled groups have voiced concern that the banks behind the

operation are making high profits through the charity's ability to

command hefty discounts from car companies.

Labour MP Harry Barnes, who is piloting his Civil Rights (Disabled

People) Bill through the Commons, said the allegations greatly concerned


''Motability is a very important scheme. If people are paying

excessive amounts for the service then that's unfortunate and it reduces

its scope. It's something that I intend to pursue.''

Mr David Whitton, of the Spinal Injuries Association, said: ''While

Motability is an excellent scheme, there are concerns about the lack of

any other competition.''

Disability groups were so concerned about Motability's activities that

they arranged a meeting with vice-chairman Gerry Acher two weeks ago.

Motability had agreed to come back with figures but had not yet done


The Daily Telegraph, in an article by assistant editor Boris Johnson,

has questioned the way the charity operates and suggested it was making

money from disabled people.

Lord Sterling, chairman of the shipping group P&O and close adviser to

Baroness Thatcher, said that Motability had a ''remarkable'' record.

''The NAO decided over a year ago to look at payments to Motability as

part of its programme of reviewing DSS grant in aid bodies. There is

nothing unusual in this,'' he said in a letter to the Telegraph.

''Mr Johnson states that Motability is a monopoly supplier of cars

which has the potential 'to make rather a lot of money from disabled


''When I remember from the very day Motability started the tremendous

support we have had from the banks, not just financial and

administrative, but in terms of advice and know-how, I think his

accusation that the scheme is 'a nice little earner' is totally


One charity source has estimated that disabled people are effectively

paying up to #150 too much per car, and that surplus profits are running

at about #12.5m a year.

The NAO confirmed that an investigation was under way but insisted

that it was routine and similar to others carried out each year on

dozens of organisations which spend taxpayers' money.

''We are looking at what they are doing, seeing how their systems

operate and particularly their accountability to the people who are

paying them,'' an official said.