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Cash for clunkers scheme is the route to big savings

NEW HYBRID: The petrol/electric Toyota Prius is an option in the scrappage schemeMy car is 12 years and I am thinking of changing it for a newer model.

Up to now, I have always driven second-hand cars but I am looking at the Government's scrappage scheme and wondering whether or not it would make more sense to buy a new car this time.

My current car is a 1.4 litre petrol-engined VW Golf.

James

Under the Government's scrappage scheme, anyone trading in a car ten years or older may qualify for a VRT refund of up to €1,500.

To qualify, the car you are trading in must have been registered in your name for the previous 18 months.

You will also have to produce your insurance certificates for the previous 12 months as well as an up-to-date NCT certificate.

When deciding which car to buy under the scrappage scheme, it is important to remember that not all cars are eligible.

Only cars with emissions of 140 grams or less per kilometre qualify for the scrappage scheme. That is cars in the "A" and "B" VRT bands, 14pc and 16pc respectively.

In practice this means that, unless you opt for one of the over-priced petrol/electric hybrids, your choice is in practice confined to a very small petrol engine or one of the new generation of diesel engines whose emissions are now within spitting distance of the hybrids.

While virtually all of the focus has been on the €1,500 VRT refund, most people trading in an old clunker, particularly a petrol-engined model, will also see significant savings in their annual road tax bill.

At the moment, James is paying €333 per year road tax. Depending on whether he opts for a car with emissions of less than 120 grams per kilometre or less than 140 grams per kilometre, he will see his annual road tax fall to either €104 or €156.

So should James go for the scrappage scheme when he replaces his car or should he choose a second-hand car?

With the excise duty gap between petrol and diesel likely to continue to widen and the road tax on pre-2008 petrol-engined likely to keep rising vis a vis low-emission cars taxed under the new system, he should go for the scrappage if he can possibly afford it.

If he does decide to go for the scrappage scheme he shouldn't wait too long.

It runs out at the end of the year and there are long waiting lists for many of the most popular qualifying models.

We've switched our electricity account in recent months to Bord Gais. Our typical bills are €70-€80. Our latest bill has jumped to €366, even though we were out of the country for two of the weeks affected. Bord Gais keep passing us back to ESB and vice versa, and say the meter could be running too fast. Who is responsible for this mess?

Mark

Mark's predicament demonstrates the potential downside of switching from an incumbent utility supplier, such as the ESB for electricity or Eircom for broadband and fixed-line telephony, to a new entrant to the market. When everything goes according to plan you can save money.

But what happens, as in Mark's case, if everything does not go according to plan? Who is responsible when things goes wrong? It is very easy to fall into the cracks. From my reading of the situation, if the problem is with his meter then Mark needs to contact the ESB. This is because, although his electricity account is now with Bord Gais, it is still the ESB which owns and maintains the meters.


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