Roddy Graham's blog: 15 June 2012 - You can't have your cake and eat it
15 June 2012
Roddy Graham is commercial director of Leasedrive Group and Chairman of the ICFM.
Am I the only one thinking that the Government is beginning to unravel?
I'm not talking about all the famous U-turns that seem to follow every fresh initiative that was headlined in a blaze of glory only to be unceremoniously swept under the carpet on a bad news day. I'm concerned that the highly effective emissions-based vehicle taxation regime may be about to be ditched too.
It seems, unsurprisingly, that the Government is getting rather nervous about the loss in expected revenues as drivers opt for lower emission vehicles.
With nearly half of all purchases below 130g/km, the Treasury is receiving fewer coppers into its war chest, at a time when it is precariously short of revenues and it is trying to wield the budgetary axe left, right and centre.
What the Government hasn't realised yet is that you can't have your cake and eat it. If it quite rightly wants to reduce overall carbon emissions, it can't then be surprised if its tax incentives lead to a fall in expected revenues.
It should certainly not abandon a policy that has been the envy of many other western governments on the basis that it is collecting less revenues from the already hard-up motorist. And with many businesses fighting hard to survive in these turbulent economic conditions, the thing it can least afford to do is pass the buck from drivers to already hard-pressed companies.
The problem with the Government is that it can be as short-sighted as city folk. Just as the money men only think short-term, the Government is in increasing the danger of falling into the same trap. OK, politicians will always have one eye on the next election, but the Government should be all about long-term planning and the delivery of goals against agreed clear strategies.
Watering down a successful emissions-based taxation regime should not even be on the table, let alone seriously contemplated.
I guess the first signs we have had of a Whitehall wobble is confirmation of the abandonment of EV grants in 2015.
Just as we were seeing some signs of greater public interest in electric vehicles, the very incentives designed to encourage adoption are to be pulled. Incentives should continue until at least the end of the decade for electric vehicle take-up to gain real momentum.
By 2020, electric vehicles should be part of the mainstream. The public charging point network should be, by that time, more than comprehensive enough, battery development should have gathered pace to the point where expectations of longer, more acceptable ranges on a single charge should be the norm and cost of ownership should be down and residual values far more predictable and acceptable.
By then, fuel cell cars should also be starting to appear in fleets, as electric vehicles are doing today. Five years ago Honda was talking of these starting to make an impact by 2020, but the general consensus among manufacturers is that fuel cell vehicles will not start coming into their own until 2030.
Make no mistake, with governments worldwide having to meet tough carbon emission targets, clean air towns and cities will have to become the norm in the future.
Let's just hope that the Government, whatever colour hue, has the foresight to stick to its guns on emissions and a strategy to make it happen long-term.
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