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SMMT warns of 'lost year' for cleaner vehicle grants
Cleaner vehicle grants face further delays this year, damaging the market for the cleanest vehicles and creating more uncertainty for manufacturers and their customers, according to the SMMT.

Schemes like Powershift and CleanUp, managed by the Energy Saving Trust, had offered £14 million in grants for new car buyers and commercial vehicle operators in 2004/05. However, these were discontinued in March amid concerns of a breach of European state aid rules.

Six new schemes had been submitted to the Commission by DfT, including a Low Carbon Vehicle Programme, an Air Quality Retrofit Programme and a Low Carbon Bus Programme, with a total budget of £24 million. So far, though, only the Infrastructure Development Programme has received Commission approval.

Of the remaining five, government must now respond to a number of concerns. These are unlikely to be reviewed by the Commission until autumn, leaving the SMMT doubtful that any will be up and running before 2006.

SMMT chief executive Christopher Macgowan commented, “Long-term incentives for the take-up of cleaner vehicles are vital to building consumer confidence and driving manufacturer investment. So it is important that government does not allow 2005 to become a lost year. The current situation sends out completely the wrong message at a time when grants should play a central role in the Powering Future Vehicles strategy, as well as in supporting the work industry is doing to deliver new technologies and provide better consumer information.”

The five programmes affected by the delays are:

- The Low Carbon Research and Development Programme - funding for vehicle makers to develop prototype low emission vehicles

- The Low Carbon Bus Programme - grants for bus operators

- The Low Carbon Vehicle Programme - grants for buyers of cars and car-derived vans

- The Air Quality Retrofit Programme - funding for conversions and exhaust system retrofits

- The Air Quality Vehicle Programme - grants based on air quality standards at type-approval level for new buses and trucks.