Despite reporting yesterday that the treasury were “blocking plans” for a UK scrappage scheme the Times reports today that “Darling will offer £2,000 reward to scrap old cars”…Guess we’ll just have to wait and see!
ALISTAIR DARLING, the chancellor, is set to end months of speculation by announcing a “scrappage” scheme to encourage people to trade in old cars for new in his April 22 budget.
The policy has been urged on the government by the crisis-hit motor industry, which is facing an alarming collapse in output. It says that without a new sales incentive, the sector will face tens of thousands of job losses.
Details of the scheme are still being finalised in discussions between the Treasury and the business department, headed by Lord Mandelson. It is expected to involve a £2,000 allowance for people trading in for scrap a car more than nine years old against the purchase of a new or nearly new vehicle.
Ministers and officials are said to have been impressed by the impact of such schemes in other countries. A similar scheme in Germany, involving a €2,500 (£2,250) scrappage allowance, has reversed its slide in sales. New car registrations in Germany last month were up by 40% on a year ago. In Britain, in contrast, they were down by more than 30%.
Whitehall sources dismissed reports that Darling and Mandelson were at loggerheads over the issue. “It is completely wrong to say Alistair and Peter have fallen out on this,” said one. The sources said it was recognised in government that while help was on the way for the industry in the medium term, including loans from the European Investment Bank for the development of greener vehicles, help was needed in the short term to pull the industry out of its slump…Full story