Government policy is to not retroactively change tax bands but to control vehicle use through other means, eg emissions zones.
I’m sure you can work out the morally correct action based on the types of areas you drive through. You don’t really need the government to make this decision for you.
Ignoring the question of whether there's even a morally correct action here, why not keep the worthless car you already have instead of replacing it with a newer one? That £10,000 will pay for a lot of petrol, car tax and repairs.
As someone's who's tried that, depending on how old the car is, that 10k can be burned through rather quickly. And then there's next year's maintenance to worry about.
I’m sure you can work out the morally correct action based on the types of areas you drive through. You don’t really need the government to make this decision for you.