Mandelson ignores calls to top up car makers’ wages

The government has ignored calls from unions and car manufacturers to support workers during periods of reduced production because of falling demand.

Although business secretary Peter Mandelson increased fnding for the Train to Gain scheme offered to the car industry to £100m, he did not address calls from unions and manufacturers to supplement the pay of workers who have had their hours cut during the economic downturn.

In November, the government made £65m available through the Train to Gain skills service for car firms to prepare their workforces to prosper when the economy recovers.

Today in the House of Lords, Mandelson announced the measures to extend the Train to Gain scheme applicable to the car industry, along with a package of multi-billion loan guarantees to aid the automotive industry where thousands of jobs are under threat.

The government will guarantee £1.3bn loans from the European Investment Bank to the car industry, as well as a further £1bn in loans for investment in the “greening of the car industry”, Mandelson said.

He said loan guarantees would be made on a case-by-case basis, and the government was not signing a blank cheque or operating subsidies.

The government would also offer £110m in R&D funding through regional development agencies, he said.

The announcements contained no new money, but detailed how some of the funds already allocated to support business in the downturn will be spent.