The coalition government has committed to honouring the previous government's £5000 ‘Plug-In Car Grant’ - but the scheme is now around 80 per cent less generous, opposition politicians have claimed.
The grant, confirmed today by transport secretary Philip Hammond, will launch in January 2011 and offers up to £5000 towards motorists buying an electric, plug-in hybrid or hydrogen fuel cell car. The scheme will initially run until March 2012 and there will be a review in January 2012.
Speaking at the Society of Motor Manufacturers and Traders, Hammond said, “The coalition government is absolutely committed to low carbon growth, tackling climate change and making our energy supply more secure.
“We are sending a clear signal that Britain is open for business and that we are committed to greening our economy. This will ensure that the UK is a world leader in low-emissions vehicles."
But the scheme is worth £43 million, much less than the £230 million originally promised by Labour. Labour's shadow transport secretary Sadiq Khan said there had been no plan to review the scheme after a year under its plans and claimed "the coalition must show greater ambition than this" if Britain is to attract more manufacturers to building low-carbon vehicles in the UK.
The amount of money committed by the coalition is enough for grants for up to 8,600; under Labour's plans, the grants could have funded almost 50,000 cars. However, a Department for Transport spokesman said the coalition scheme's first year funding was a match for Labour's plans.
SMMT chief executive Paul Everitt said Britain was now well placed to lead in the emerging market for ultra-low-carbon vehicles.
"The UK is well placed to exploit the global opportunities in the transition to low-carbon technologies and is already making significant progress through R&D, the low-carbon supply chain and vehicle manufacturing," he said.
“The Automotive Council has set some ambitious objectives and today's announcement is an important step in helping to attract new investment and laying the foundations for thousands of new high-skill jobs.”