The car scrap incentive scheme will go ahead as expected, Alistair Darling confirmed today (Wednesday 22nd April). Having said that, it's not actually going ahead quite as expected - because only half the money will come from the Government.
We all knew the plan would get the green light, but only during the Chancellor's budget speech did it become clear quite how the scheme is going to work. Starting next month, the Government will offer £2,000 against the price of a new car when an old one is traded-in against it. And by 'old,' we mean 'over ten years.' And by 'Government will offer £2,000, ' we mean £1,000.
Confused? What we didn't expect was that Darling would only offer half the £2k bribe and ask for the other half from the car industry itself, the cheeky so and so. As such, makers can opt out of the scheme (though few will, exemplified by the fact that Citroen is already offering a £2,000 scrap scheme of its own).
The specific requirements buyers must meet to get the loot are that their car must have been registered before August 1st 1999, must have a valid MOT, must have been in the buyer's possession for at least 12 months, and must be traded-in for a brand new car. There's no limit on the CO2 rating of the new car in question either - something that has irked the environmentalists no end.
A sum of £300m has been set aside for the scheme, which will end in March 2010 - or when the money runs out. The DVLA will audit it. Of course, there's been a mixed reaction from the makers and the action groups, split loosely between a big "thanks very much" from the makers; a cautionary "this is a good for the economy but isn't it a bit pointless scrapping perfectly good ten-year-old cars?" from the motoring interest groups; and a big fat "are you kidding?" from green types.
The move to add 2p to fuel, however, has been met with universal disdain. From September, pump prices will go up by a further 2p, equating to about £1 extra per tank. But worse still, every April for the next four years it will go up by a further 1p over and above inflation. And, of course, VAT will go back to 17.5 percent at the start of next year too. Here we go again...
Mark Nichol - 22 Apr 2009
