Memorandum by the Automobile Association
THE ECONOMIC IMPACT OF THE END OF LIFE VEHICLES
The Automobile Association welcomes and supports
the aims of the Directive and recognises the need to control waste
and environmental hazard from End of Life Cars.
The two main economic aspects of this Directive
concern, firstly, how the disposals of existing UK vehicles are
to be paid for and, secondly, how post 2002 registered cars will
be dealt with. These comments relate to how the proposals may
affect the motorists concerned.
In the UK there has historically been a "cottage
industry" disposing of cars in an uncontrolled fashion, but
reasonably cheaply in that a motorist with a terminal car has
usually been able to take it to a scrapyard and let them deal
with it, at no charge. This is no longer the case. Most firms
will now require payment for disposaland as many last owners
are unwilling or unable to pay for the disposal of their car,
car dumping has climbed to some 250,000 pa. More thorough methods
of handling waste can only increase disposal costs, increasing
the problem, despite the threat of substantial fines on erring
Abandoning a car is an antisocial and potentially
dangerous act. Law abiding, environmentally aware motorists take
the responsibility for the disposal of their end of life cars,
but there will be a minority, and a growing one, who won't or
can't afford to pay. Faced with the prospect of finding a disposal
facility willing to take a car, and paying for the transport and
disposal, the quick and cheap alternative of dumping may be taken.
While this cannot be condoned, it is important in this debate
to understand why so many owners choose to abandon their car.
If the DVLA record systems carried all the requisite
current information, tracing the last owner would be an effective
deterrent. However, for example looking at 1989 registered cars
Thus the balance of 624,000 cars from that one
year alone was accounted for. These figures appear not untypical,
and as few of the last owners actually traced may be able to pay
a £1,000 fine, the complicated and expensive process can
recover very little. The administration and recovery costs fall
on the local authority direct or on the police if removed as a
The dilemma is that charging the last owner
the full cost of disposal may have an adverse affect, resulting
in further increases in dumping and therefore substantially increased
recovery costs, local hazards and complicated, expensive administration.
On the other hand, free take-back, or even some
positive financial incentive (such as free public transport vouchers)
for getting the car to a disposal site could help contain the
problem. This was the evident intention of the Directive, recognising
the fact that these ageing cars are all out there, and the overall
cost of disposal can only increase in the absence of proper controls.
It must be preferable to reduce the size of this total cost burden
that would require public funding: only an easily accessed efficient
disposal process can hope to achieve this end.
The funding of this process can hardly be put
entirely upon the industry in view of the retrospective nature
of the chargeat least a period of time would need to be
allowed for a fund to be accumulated. One option would be a taper
system whereby the cost is subsidised but reduced annually until
the manufacturers' scrappage fund is accumulated.
POST 2002 CAR
A scheme of "bonds" for the ultimate
disposal costs, applied on the sale of new cars is a reasonable
measure. There are of course several important provisions, including
Bonds must be set at a discounted rate to cover
the future disposal costs.
The bond value must be reviewed and audited by
an independent bodycertainly not by Government nor by the
There should be no surcharges or tax applied
to the bonds.
The 45 Euro figure used in Holland could be a
good starting point.
Bonds would not follow individual cars. Hence
once passed by the vehicle producer to the central fund, no further
action would be needed by the subsequent vehicle owners for free
To ensure easy access for the last user to disposal
facilities, either many more sites or an efficient collection
and routing service will be needed. Considerable capital expenditure
will be involved in setting up adequate disposal facilities. If
the large numbers of cars involved are to be handled effectively
within the time-scales specified, special funding may be required.
Incentives will be needed for disposal centres
to attract cars, possibly as part of their recycling target system,
rather than just letting centres deal with those cars that are
presented by last owners.
It is quite logical to use some Local Authority
parking revenue to cover some of the costs, as legitimate transport-related
Falling residual values of older cars has had
the beneficial effect of increasing the uptake of newer technology
vehicles, thus contributing to improved air quality and better
occupant protection. Easier disposal could help in this respect,
as the prospect of repairing a near-EoLV will be that much less
attractive. Car scrappage schemes have foundered in the past due
to market distortions and complexities. A very positive benefit
could be shown by a well-designed incentive which in the end could
cost Public Authorities less than enforcement and disposal otherwise
The owners and users of these near terminal
cars are running them on very tight margins, and even relatively
small payments can be a real problem. A short-term outlook may
be taken when unexpected repair or disposal costs arise. The processes
involved need to be made very straightforward and easily accessible
to avoid too many cars being dumped.
A scheme to provide free take-back, with a positive
incentive such as travel vouchers, would cut dumping and make
the whole operation much more efficient and manageable. It may
be cheaper for the public purse, and safer, and could bring about
other environmental benefits such as increasing the proportion
of catalyst equipped cars on the roads.
For cars registered after 2002, a bond scheme
from a charge at sale could cover the ultimate disposal costs.