The government kept the car scrappage scheme in place and extended it to central heating boilers, claiming it as a big success. Yet looking at car sales in the last few months it appears the makers of Hyundai and Kia have done very well. You could say in a recession people will buy such cars, although it seems that a large discount paid for by the taxpayer will help.
All over Europe car sales are said to have benefited from scrappage schemes, although not many cars made in Britain seem to have benefited a lot. The Fiesta seems to sell well but it’s not British. The Astra is British and seems to do well, but the Mini dropped out of the top 10. Jaguar has improved sales as well although that’s more to do with the value of the pound. If you have a 10 year old car worth £2000 then you aren’t going to afford a £12,000 car unless you trade in your sons car and buy him a better banger.
Then you might say VAT, then 15%, transport and dealer costs are in the UK which is a fair amount and the scrapyard is getting business. Even so it seems an extravagent way to spend taxpayers money when a lot of the benefits are going overseas.
Then there is the boiler replacement scheme. The cost of boilers is always a contentious issue. You can go into a DIY store and find one for a few hundred, yet if you contact a large company to install one it costs thousands and you might think the discount is lost in there somewhere. Like many things related to house maintenance there isn’t a price list so you never know if the discount is being taken by the installer.
These schemes tax the imagination. It isn’t easy to come up with a quick hit to get a flat economy moving, but whether such broad brush schemes are the best way is open to question.