MPs Back Scrappage Scheme

A cross party group of 25 MPs has written to Business Secretary, Peter Mandelson, asking for immediate action to support the vehicle component industry, including a car scrappage scheme like the systems that have been successfully running in Germany and France. According to the department for Business, Enterprise and Regulatory Reform (BERR), the component industry employs some 100,000 people who now face a bleak future because of the economic downturn. However, the group of MPs suggest that targeted measures could help turn the situation around.

The highest profile suggestion is for an “appropriately structured scrappage scheme” subsidising the replacement of old cars in favour of newer more environmentally friendly models. However, the MPs all back support for car finance to stimulate the demand side; improving access to credit and liquidity; and sharing the burden of continuing to employ staff between employees, employers and the government.

George Howarth, Labour MP for Knowsley North and Sefton East, said: “The UK’s vehicle component industry is fundamentally sound, yet the economic downturn has placed unprecedented pressure on the sector. Immediate action that saves jobs, gives better access to credit and supports consumers to buy more environmentally-friendly cars will ensure this high-tech industry is able to survive the downturn.”

Julie Kirkbride, Conservative MP for Bromsgrove, added: “The British automotive sector is a world-class industry and needs help in these enormously difficult economic times. Other countries have already leapt to the aid of their automotive sector which makes our situation all the more urgent. I think these proposals provide a solid base from which we can secure a long-term future for the industry.”