Autovolt Magazine

Autumn Statement: How it Affects Electric and Hybrid Vehicle Owners

After the weekend, allowing hype and opinions to have been expressed nationwide, we feel it’s worth taking a look at the pros and cons of the Autumn Statement made by George Osborne last Thursday the 5th December.

Electric vehicles

The Government is charging up its plans to increase public sector fleet penetration of electric vehicles with a £5 million investment in a large scale “readiness programme” between 2014-15.

The Government says the initiative is aimed at promoting the adoption of ultra-low emission vehicles and demonstrating clear leadership by the public sector to encourage future widespread acceptance.

The cash is in addition to the summer 2013 announcement that saw the Government commit £500 million to support the take-up of ultra low emission vehicles, which is in addition to the £400m it is currently investing through a number of initiatives. Chief Secretary to the Treasury Danny Alexander in publishing the National Infrastructure Plan said that details of how the £500m cash pot would be spent would be announced soon.

The document said:

“Transport will play an important part in meeting the Government’s environmental targets. As part of this there is a need to shift to more environmentally sustainable technologies and fuels, and to promote lower carbon transport choices.

Over the next decade, the biggest reduction in emissions from domestic transport is likely to come from efficiency improvements in conventional vehicles, specifically cars and vans, driven primarily by European Union targets for new vehicle CO2 performance.

Over this period an increasing numbers of ultra-low emission vehicles are also expected to come to market. Government is committed to speeding the transition to ultra-low emission vehicles by addressing areas where the market alone might not deliver the best outcomes in the shortest possible timescale.”

Driverless cars

The Government is to review the legislative and regulatory framework for developing and testing driverless cars in the UK, reporting by the end of 2014, and plans to create a £10 million prize for the development of a town or city as a testing ground.

The announcement was contained in the National Infrastructure Plan 2013 update, which highlighted the potential for driverless cars in the UK.

The document said:

“Driverless cars are innovative technology that will change the way the world’s towns and cities look and the way people travel; they present opportunities for the British automotive industry in the manufacture of the cars and the wider science and engineering sectors in the design of towns.

To ensure that UK industry and the wider public benefit from the development of driverless cars, the Government announces in the National Infrastructure Plan that it will conduct a review, reporting at the end of 2014, to ensure that the legislative and regulatory framework demonstrates to the world’s car companies that the UK is the right place to develop and test driverless cars. It will also create a £10 million prize for a town or city to develop as a testing ground for driverless cars.”

Chief Secretary to the Treasury Danny Alexander added:

“At present, the main advances in driverless car technology are happening in California. Apparently they’re making progress, [but] the National Infrastructure Plan contains plans to put our country at the forefront of driverless car technology.”

Fuel Duty

How does it affect the electric and hybrid car owner? Several things will have a effect. Firstly, the freeze in fuel duty should aid those with plug-in hybrids to keep fuel costs down. Secondly, it will make internal combustion engined (ICE) cars no less desirable over hybrids and electric cars as the increase in expenditure won’t be there, thus the incentive to move onto cleaner and more efficient transportation may be overlooked by many wanting to purchase a vehicle that is traditionally better value for money over hybrid and electric variants.

Vehicle Excise Duty

Perhaps the biggest change overall is that of the tax disc that will be removed from existance after more than 90 years in service. Replacing it with electronic checks will mean that vehicle owners will no longer have to make that trip to the Post Office to get their little paper disc and instead will be able to do it all online. Paying by Direct Debit on a monthly basis will incur a penalty of 5% additional cost over a yearly spend, most likely, but it should be remembered the current monthly payments scheme incurs a 10% addition so this is good news for those who find it easier not to make a large payment in one go. This won’t particularly be of interest to those who own vehicles in low tax bands as the yearly payment is so neglible, or even zero, that it shan’t affect them.

What has not been addresses yet is security. With number plate theft a common occurrence, the lack of a matching tax disc will perhaps make it easier for thieves to ‘clone’ a vehicle in most people’s eyes, including that of the passing police officer who doesn’t have the electronic means to check a licence plate while on patrol.

Company Car Tax

To protect tax revenues, and taking effect from April 6 2014, the Government will introduce legislation in the 2014 Finance Bill to:

  • Ensure individuals make payments for private use of a company car or van in the relevant tax year
  • Ensure that where an employer leases a car to an employee, the benefit is taxed as a car benefit rather than as employment earnings.

A spokesman for HM Revenue and Customs (HMRC) said:

“In both cases legislation is being tidied up to keep pace with current practice. There are no practical implications for employers or employees. Relevant explanatory documents will be published next week, but employers and employees should not have to do anything in practice that they are not already doing in terms of compliance.”

HMRC will publish a “taxpayer information and impact note” tomorrow on Tuesday 10th December.


Welcome news for motorists will be that the statutory maximum price of the MoT test of a car will be frozen at £54.85 until 2015, a total saving of £50 million for motorists, the small print of the Autumn Statement revealed. With many companies offering much lower prices on MoT testing than the maximum this may not have an effect immediately but will help in at least keeping costs the same rather than increasing them.

Road tolls

Of extremely welcome news to users of the A14 near Huntingdon, past Cambridge and which goes onwards to Felixstowe, plans to introduce road charging on the A14 has been dropped by the Government following its decision to abandoned proposals to charge drivers a £1 to £1.50 toll for travelling along the new section being built.

Originally the Government had planned to toll the new 25-mile stretch of the heavily congested A14 close to Huntingdon. Widespread oposition was made against the idea as it was seen as an extra tax on goods coming out of Felixstowe since it is a part of the essential route lorries use to get goods from the port around the country. The implication was that this would ultimately raise the price of many essential goods. However, the Government admitted tolling was now no longer part of its plans.

Nissan Leaf EV

Source; Government