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Talks over car scrappage scheme

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The Government has been in talks with motoring industry leaders to iron out the details of the car scrappage scheme which is being rolled out next month to boost dwindling sales.

Under the plans, car insurance policy holders will be given a £2,000 incentive to scrap vehicles that are 10 or more years old in return for a new model.

The scheme, worth £300 million, should be as straightforward as possible for the motor industry with the minimum number of restrictions on consumers, business secretary Lord Mandelson said.

The minister said checks would be put in place to ensure that the incentive scheme was not abused.

"I welcome the level of interest from car manufacturers that have already said they are keen to sign up to the voluntary scheme and look forward to seeing them benefit from more new buyers very soon," he added.

People taking up the scheme, which opens next month, will receive £1,000 funding from the Government and the rest of the cash from the car industry.

© Press Association 2009