The Arranger

A broker’s Budget blues

This month I am mainly going to be grumpy. I was in a relatively
good mood, having had a pretty good start to the year, until
Chancellor Gordon Brown, oops I mean Alistair Darling, nope I was
right first time, stood up and made a dog’s breakfast of the 2008
Budget doing what this government seems to do best: impose taxes on
drivers for no apparent reason other than to replenish the Treasury
coffers, which are a gnat’s private part away from bankruptcy, but
in the name of saving the planet.

Now whilst the UK’s contribution to global warming is the
equivalent to a raindrop in a storm I actually agree that we should
all do our bit to minimise the effects because if we don’t we will
all eventually cook. But surely the aim should be not to stick
another grand onto the purchase price of the car – that won’t
reduce pollution; it will just increase the cost of a new car. We
should encourage people to travel less. Not necessarily by getting
people to use public transport more, because that will never be a
truly viable alternative, but simply encourage drivers to travel
less, make fewer trips.
The motorways and A roads that used to become a little clogged
during rush hour are becoming more of a car park for more of the
day as people jump in their cars for the silliest of reasons and
then pollute the atmosphere whilst they sit in queues of traffic
for hours going nowhere.

It’s all about the mileage

Coming back to the tax on ‘gas guzzlers’, are they really such
bad news? Most of my customers that drive so-called gas guzzlers
only contract to cover 10,000 miles per annum, whilst I have many
customers that have salesmen covering up to 40,000 miles per annum,
and that is where the real problem lies.

Take an X5 diesel that throws out 231g/km of CO2. If it covers
10,000 miles per annum it will contribute 3,700kg of CO2 into the
atmosphere whereas a rep’s 2.0l Mondeo covering 20,000 miles per
annum would contribute 6,300kg. What we really need to do is
encourage lower use of cars that are covering higher mileages
rather than over-tax those cars that are actually contributing
little to the global warming, by for example giving some sort of
tax benefit to companies that use modern technology such as video
conferencing, and taxing more heavily cars that are travelling more
than 15,000 miles per annum.

The government should also revisit the cash for car incentive,
one of the daftest ideas that it has ever come up with. It
encourages drivers to drive older cars that are less
fuel-efficient, bang out more CO2 and are less safe for passengers
and pedestrians. They also require much more management on the part
of the companies providing the schemes or directors risk being
locked up for not ensuring that the driver had a roadworthy car
whilst on company business. It’s a farce; we need to get back to
company cars.

 Motor Finance Issue: 41 – March 08
Published for the web: March 28 08 11:58