The car scrappage scheme which was due to run out in October has now been extended by 100 million pounds. Business secretary Lord Mandelson announced the extension at the Labour Party conference in Brighton, a decision that will fund the scrapping of 100,000 cars and vans .

The scheme, which commenced in May, is a way for consumers to trade in their old cars for a brand new vehicle . In recent weeks automotive experts have called for an extension to the scheme to underpin the hard-hit UK manufacturing industry.

Lord Mandelson made a political stand by saying the labour policy could help to bring Britain out of recession. How the car scrappage extension supports the damaged car finance and vehicle sales industry remains to be seen.