Government must go beyond interest rate cuts says RMIF

Following the announcement that Bank of England has cut the UK interest rate by 0.5 per cent, bringing it down to 1.5 per cent; the Retail Motor Industry Federation (RMIF) has called for further support for the car industry and the economy as a whole.The government is currently in talks with motor industry leaders  such as SMMT and the RMIF who are eager to secure funding for troubled carmakers to help them though 2009.“The Government’s reliance on interest rate reductions to stimulate the economy should be part of a wider package of measures, and we urge that more direct approaches are used as soon as possible,” said Sue Robinson, Director of RMIF, who represent 8,000 businesses in the UK’s retail motor sector.Robinson continues: “Although interest rate reductions will help borrowers, it will conversely penalise savers, and those people reliant on interest for their disposable income. Unless counterbalanced with tax cuts and business support measures, further interest rate reductions could have a negligible effect on the economy.”

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