The IEEP says that motorists in the poorest fifth of the population are three times more likely to have to scrap their cars but will be less able to afford to do so. This could lead to over 250,000 more abandoned vehicles per year - a figure far higher than the 147,000 predicted by the Government's regulatory impact assessment of the EU Directive on ELVs.
The high costs of disposing of abandoned vehicles for local authorities, potentially £100 a time, means it would be cheaper for the Government to fund implementation of the Directive itself by increasing taxes.
The IEEP acknowledges that this would be "unpalatable". A "far more equitable" solution would be to raise vehicle excise duty by around 4% to pay for recycling of ELVs until producer responsibility is introduced in 2007.