Scrappage scheme not working, survey shows

02/06/2009

The Budget's flagship car scrappage scheme is not working as well as hoped, it has been suggested.

Moneysupermarket.com released research yesterday, finding that just five per cent of people are planning to take advantage of the £300 million credit crunch-busting plan.

The scrappage scheme works by offering people willing to trade their old cars in for a new model a £2,000 subsidy.

It is hoped that, if popular, it will give a shot in the arm to the car industry and the recession-hit economy.

However, the Moneysupermarket.com poll showed that 20 per cent of people think they "can't afford" to trade their cars in - and 13 per cent think they'll get a better deal by selling their car and buying another one under their own steam.

Steve Sweeney, head of motor insurance at moneysupermarket.com, said: "While one in five of those who have bought new cars since the announcement have done so through the scrappage scheme, our research shows there are many who stand by other options available; selling a car privately and then negotiating on the next model."

He added: "For motorists wanting to take advantage of the scheme I urge them not to waste any time - once the cash pot is dry the scheme will end, regardless of the March 2010 end date."

Tags; Income Worries and Debt, Young Family Finances,

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