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BUDGET '09: Scrappage scheme cut to £1000

Date: 22 April 2009

The car scrappage scheme set to be revealed by the Chancellor in the Budget at 12.30 this afternoon will be watered down to a Government grant of £1000 per car, according to a report in the Financial Times.

It had been expected a scrappage scheme would offer a £2000 Government grant to scrap a nine-year-old car against the purchase of a new car.

The FT claims manufacturers will be forced to match the Government money with a further £1000 discount on a new car.

When the idea of car makers co-funding the scrappage scheme was raised earlier this month it was attacked by the SMMT.

The FT also claims the scheme will apply to all new cars and not place a CO2 limit on which cars can be bought using the scheme.