FRIENDS of the Earth wants to raise the price of every new car sold by £500. The idea would leave the motor industry sitting on a cash mountain growing at the rate of £1,000 million a year.

The organisation sees the £500 as a scrappage allowance which would be paid at purchase to the manufacturer. At the end of the car's life the car would be returned to where it came from for recycling and the money repaid to the then owner. At every change of ownership along the way, the scrappage certificate would be sold for its face value, along with the car.

Friends of the Earth senior transport campaigner Roger Higman explained: 'If the cars were Fords, say, then they would all be returned to Ford to be scrapped. After all, Ford would know more than anyone else about its own cars so would be best able to dispose of the old vehicle.'