BUSINESS Secretary Lord Mandelson yesterday hailed the “cash for bangers” carscrappage scheme as good news for all those working in the car industry, a major employer in the North-East.

The Cabinet Minister said he hoped buyers would take advantage of the scheme that got under way yesterday, allowing owners to scrap cars and small vans more than ten years old and get £2,000 off the price of a new vehicle.

The Government and manufacturers are sharing the cost of the scheme, which will last until the end of next February or until the £300m Government funding runs out.

It is expected to help car makers such as Nissan, which employs more than 3,000 people on Wearside.

The Japanese car maker has been hit hard by the slowdown in global sales, and in January announced that 1,200 staff at Sunderland – almost a quarter of its workforce – would go.

A month later it announced 20,000 job losses globally over the next year to combat sliding sales.

Lord Mandelson said: “We have put £300m into this scheme and we want every penny spent on new cars for Britain’s motorists.

“It will not just be a great bargain for the motorists, and a great opportunity for them to seize, but of course it will be a great boost for those hundreds of thousands of people who work in, or are dependent on, the car manufacturing sector in our country, so it is a win-win all way round.

‘‘That is why I hope people will go out and take advantage of the scheme.’’ Such schemes have worked well overseas, particularly in Germany, where new car sales soared 40 per cent in March.