Page last updated at 16:16 GMT, Thursday, 27 November 2008

Builders and carmakers seek help

Toyota's Burnaston Plant in Derbyshire

Senior figures from the UK's car and construction industries have met with ministers to appeal for government assistance during the downturn.

The Prime Minister hosted a breakfast meeting with representatives from the housing and building sectors.

They called on Gordon Brown to put more pressure on banks to make lending available to home owners.

Later Lord Mandelson, the business secretary, met with carmakers who wanted financial aid.

With car sales tumbling globally, manufacturers want a substantial financial package from the government to help them through the tough economic climate.

They want a state-guaranteed credit facility, more credit for manufacturers and suppliers, easier access to cash for car finance firms and a delay in the rise in vehicle excise duty.

'Proper funding'

Construction worker
The construction industry is seeking help from the government

At the summit building trade bodies called for more state funding as well as increased pressure on banks to free up lending.

Gordon Brown told the meeting: "The flow of money is not how it should be and that is affecting confidence in the economy." He added that his government was still working with the banks to ensure "proper funding".

Participants at the meeting included the Council of Mortgage Lenders and the Home Builders Federation as well as Margaret Beckett, the Housing Secretary.

The Home Builders Federation said the 150m to boost social housing projects - outlined in this week's pre-Budget report - was nowhere near enough to help the industry.

'Constructive meeting'

The Society of Motor Manufacturers and Traders (SMMT) said the meeting between car industry executives and Lord Mandelson had "emphasised the urgent need to address liquidity and restore demand".

SMMT chief executive Paul Everitt said the two sides had "agreed to explore collaboratively, a range of solutions in a timescale that matches the urgency of the situation".

However, a spokesman at the Department of Business, Enterprise and Regulatory Reform said that no specific measures had been agreed.

In the US, the "Big Three" carmakers have been told to come up with their own viable recovery plan if they want a $25bn (17bn) government rescue.

The leaders of both houses of Congress said Ford, General Motors and Chrysler had until 2 December to present a plan.

Meanwhile, the European Commission proposes to give at least five billion euros (4.25bn) to the car industry to help develop green technologies.

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