The process is more stringent than the old lab-based NEDC (New European Driving Cycle) system. Current diesel cars are only required by European law to conform to RDE step 1 standards, meaning the Budget's requirement for step 2 could affect even the very latest models. This essentially means the government will begin penalising models that don't conform to a 2020 regulation from April 2018.
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The UK's Society of Motor Manufacturers and Traders boss Mike Hawes believes this is unfair, stating: "It's unrealistic to think that we can fast-track the introduction of the next generation of clean diesel technology which takes years to develop, in just four months. This budget will also do nothing to remove the oldest, most polluting vehicles from our roads in the coming years.”
The new diesel tax hike, which Hammond said applies exclusively to cars, leaving van and lorry drivers unaffected, forms part of the government’s plans to fight Britain’s growing air quality problem, of which it labels diesel pollution a major contributor.
But Hawes believes that targeting the newest diesels is the wrong method to take. He said: "We know the government wanted to raise revenue to pay for the air quality plan. We recognise that they didn’t want to penalise existing diesel-car owners who bought their cars in good faith. But we want to encourage the latest technology”, referring to new diesel cars on the market. He added that there was “nothing in the budget about getting older vehicles off the road,” which are the worst offenders in the quest for better air quality".
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Hammond said that the money raised from the raised diesel taxes, which the government claims will amount to £70 million in 2018 and £35m the year after, would be used to fund air quality improving projects.
Referring to the changes to diesel company car tax, the AA's director of fleet and SMEs (small and medium sized enterprises), Stuart Thomas, said that the new Budget adjustments may be met with confusion.
“Fleet managers are positively investigating alternative fuel sources, but our research shows they don’t feel they have enough information to take a strategic step forward," he said. "A number of industry roadmaps exist which plot the UK’s journey towards a low-carbon future but which are heavily jargoned and not easily understood by the SME sector."
In his Budget response, Labour Party Jeremy Corbyn said the Autumn Budget adjustments will hurt "ordinary people". He added: "The reality test of this budget will be how it affects ordinary people’s lives."
Hammond also confirmed that fuel duty will remain frozen, ensuring this is the longest period without change to the duty seen in Britain for 40 years. The government claims that the frozen rate will save motorists on average £160 in 2018.
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Alongside his clampdown on diesel, Hammond announced a £400 million investment into the UK’s electric car charging infrastructure in a bid to attract motorists to electrified vehicles. He confirmed £100m has been allocated to continue plug-in car grants to 2020.