Brown may push green budget to spur recovery

UK prime minster Gordon Brown yesterday said that the upcoming budget would provide a range of environmental measures to stimulate recovery from the recession and create thousands of 'green jobs'

He told the media that the government would unveil the plans in the budget on April 22. A part of the budget would provide for boosting the use of electric cars and creating a network of charging points in pilot cities.

Brown has long been instrumental in creating an investment climate for green projects that would help fuel economic recovery. The government last month published a low carbon industrial strategy that would create 400,000 environmental sector jobs in the next 8 years.

Brown maintains his green measures would create jobs and also improve the quality of life. He said the government would like to harness the desire among people to be part of the green initiative.

One of the schemes under consideration provides for offering motorists £2,000 for trading in their old car for a new one. The scheme on the lines of a scheme operating in Germany would provide an incentive to people to switch over to new energy efficient green models of cars
However, Brown will first have to settle a dispute between business secretary Lord Mandelson and chancellor Alistair Darling before the scheme can be introduced.

Darling seems to have reservations about the scheme and wants that Mandelson's department work more on it to prove it will actually work before it is signed in the next week' budget.

Darling thinks the cash incentives for environmentally friendly cars would only encourage imports of foreign cars. He also wants that the British car industry cover the expenses to the extent of half the cost.

However according to Mandelson the German experience has shown that the scheme would boost demand for new cars. In Germany car sales shot 40 per cent in March following the introduction of a scheme that allowed buyers a €2500 euro discount to junk cars more than nine years old.

The experience in France and Italy both of which offer incentives has been identical.

According to the latest figures UK car sales plunged 30.5 per cent last month from a year ago despite the arrival of new 2009 number plates.

The European scene
Many governments in Europe have sought to incentivise a switch to green cars, a move that has increasingly spurred car sales.

In Germany consumers can avail discounts of  €2,500 to buy new fuel-efficient cars. German car sales have zoomed 40 per cent.

In Slovakia people who own a car more than ten years old receive a a €1,000 subsidy for buying a new car costing upto €25,000.

In France motorists can scrap cars more than 10 years old and avail a  €2,500 subsidy for a replacement with an engine that matches Euro 4 rating.

In Spain, the government provides an interest-free loan of up to €10,000 towards the purchase of a new car costing less than €30,000 with carbon dioxide emission under specified limits.

In Greece, the government pays €400 and €800 for the car to be scrapped. Additionally the consumer can avail  €1,500-€3,400 on the purchase of a new car with ecological credentials.