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Preparing Britain's Economy for the Future

I certainly applaud local initiatives such as those in the hon. Gentleman's Kettering constituency. I believe local authorities can play a great role and that local activism is essential, just as I believe that the Government must be active to help people and businesses through these difficult times. I want to emphasise the longer-term challenge and the actions we are taking to prepare the UK for the upswing. Although there is more to be done overseas and at home, recovery will come. As the Chancellor said in his Mansion House speech yesterday, there is growing evidence that the steps taken at home and internationally are stabilising the banking system and supporting our economies. We expect the UK economy to return to growth around the turn of the year, and we are confident about the British economy in the medium term, but we are not complacent. We must recognise the numerous risks that could threaten both a recovery in the short term and sustainable growth in the future. We have taken steps in the UK to support the cash-flow, credit and capital needs of businesses. Banks have been recapitalised and steps have been taken to unstick wholesale markets. The enterprise finance guarantee and the working capital scheme are helping to ease the strain of the downturn, and banks are now committed to lending more. We have started to see conditions improve. At the same time, HMRC's business payment support service is allowing firms to spread tax payments over a longer and more affordable timetable. As of 14 June, more than 149,000 agreements had been reached with businesses, worth £2.6 billion of tax. In the automotive industry, for instance, the vehicle scrappage scheme is providing a temporary and welcome boost to the industry at a difficult time. Figures released this month show that more than 60,000 new cars have already been ordered since the scheme was announced—and this is only part of a wider package of support for motor industry.