Government criticised for cuts to electric car grant

The Government has announced further changes to its grant scheme aimed at encouraging people to buy electric cars – a move it says will help more people make the switch.

Under the changes, the Government will provide grants of up to £2,500 for electric cars priced under £35,000 – the first time such a restriction has been put in place.

Previously, £3,000 had been available to all prospective buyers.

The Government says the changes will mean the funding will last longer and be available to more drivers. It adds that grants will no longer be available for higher-priced vehicles, typically bought by drivers who can afford to switch without a subsidy from taxpayers.

However, there has been criticism, including from the RAC, who says the Government now risks people holding on to their older, more polluting vehicles for longer.

Rachel Maclean, transport minister, said: “We want as many people as possible to be able to make the switch to electric vehicles as we look to reduce our carbon emissions, strive towards our net-zero ambitions and level up right across the UK.

“The increasing choice of new vehicles, growing demand from customers and rapidly rising number of chargepoints mean that, while the level of funding remains as high as ever, we are refocusing our vehicle grants on the more affordable zero emission vehicles.”

Incentives to get consumers to go green “remain vital” – RAC
Launched in 2011, the plug-in car grant scheme initially provided prospective buyers with £5,000 to stimulate the early market for ultra-low emission vehicles.

In 2018, the grant was changed to focus on zero-emission cars – with the maximum grant reduced to £3,500. This was further cut to £3,000 in 2020 – when it was announced the scheme would continue until 2022/23.

Since its launch, the grant has provided buyers with close to £1.3 billion, supporting the purchase of more than 285,000 vehicles.

The RAC says the decision to cut the maximum grant available goes against the Government’s ambitions to encourage people into cleaner vehicles.

Nicholas Lyes, RAC head of roads policy, said: “Ministers seem to talk-the-talk when it comes to encouraging people into cleaner vehicles, but cutting the plug-in car grant certainly isn’t walking the walk. 

“While it’s understandable to focus grants on the affordable end of the market where there’s the best opportunity for greater take-up, the industry has been hit hard by the pandemic and incentives to get consumers to go green remain vital in encouraging the sale of clean new cars. 

“The extent to which drivers might delay upgrading their vehicles as a result of the economic effects of the coronavirus is also yet to be seen, which makes the timing of this announcement all the more surprising.

“Even though more models are coming on to the market, our research suggests upfront cost remains a concern to drivers when comparing the cost of an electric vehicle with a similarly sized conventional vehicle. 

“By cutting the grant, the Government may risk people holding on to their older, more polluting vehicles for longer.”

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