Expert Blog

The ongoing debate on diesel vehicles

Almost a year ago, we wrote about the establishment’s crusade against diesel. At the time, the Supreme Court had just ruled that more must be done to reduce emissions of nitrogen dioxide (NO2), which mostly come from diesel engines – and politicians, such as the then Mayor of London, Boris Johnson, were happy to oblige. He announced that central London would become an Ultra-Low Emission Zone, meaning financial penalties for diesel drivers, by 2020.

This crusade has carried forward to today. In fact, the new Mayor of London, Sadiq Khan, wants to expand the borders of the ULEZ and introduce it sooner.

George Osborne's view on Deisel engines

Except one politician, in particular, has seemed reluctant to join the throng, and he’s quite an important one: George Osborne, the Chancellor. It’s true that he abruptly extended the diesel surcharge [CC1] on Benefit in Kind tax for another five years, which is an unexpected cost for those with diesel company cars. But, aside from that, he hasn’t done as much as the judges, or the rest of us, might have expected. His most recent Budget even confirmed that the company car tax system will continue to be based on carbon dioxide emissions, rather than on NO2. He’s let diesel off relatively lightly.

Patrick McLoughlin's thoughts

But are things about to change? The Transport Secretary Patrick McLoughlin, whom we recently interviewed, has given another interview to the Evening Standard in which he talked about diesel. He claimed that it was a ‘mistake’ of the former Chancellor Gordon Brown to incentivise the purchase of diesel vehicles through the tax system. And he continued to say that the current Chancellor ‘will need to look at’ the current setup. As though to underline his point, he added: ‘It’s something that we’ve got to address.’

There’s not much that we can add to the Transport Secretary’s words because… well, there’s not much to add. Is he speaking on behalf of his Government and Mr Osborne? Or are these just his own views? And if we are to see further action against diesel, what form will it take? And when will it happen?

We shall have to wait until the Autumn Statement, or perhaps Budgets after that, for answers.

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