18 March 2009

Populist rubbish from Mandy

Mandy’s latest grand plan to revive Labour’s fortunes will do little for the UK car industry;

Plans to give drivers £2,000 to trade in an old car for a new one will help to prop up car plants in France and Germany but do very little to protect British jobs, according to a leading motor industry economist.

Only 4 per cent of the cars bought under the scrappage scheme would be made in Britain, said Professor Garel Rhys, of Cardiff University Business School.

Both the Treasury and Dept of Transport are against:

A note from the Treasury to the audit committee said: “Those who are able to purchase new cars after scrapping an old car may have planned to do so anyway. A scrappage scheme is likely to have a large deadweight cost.”

Analysis by the Department for Transport challenges the claim that a scrappage scheme would help the environment. The emissions savings from taking older, fuel-hungry cars off the roads early would largely be cancelled out by the environmental cost of manufacturing new cars.

It will be interesting to see who wins the battle for this ill thought out scheme.

Mandy has a few political problems on his hands.  The Royal Mail sell-off is in trouble on all fronts and now this.

All spin and no substance from the man with a failed plan.

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