THE Society of Motor Manufacturers and Traders has fired the first shots in the war of words preceding the Labour Government's next Budget with a ringing endorsement of the company car. Following a relatively harmless Budget, the car makers' trade association has put its lobbying machine into overdrive with an emphatic 'hands off' message.

SMMT chief executive Ernie Thompson said it was vital to defend the car against the well-intentioned but badly informed onslaught from environmental pressure groups.

'A lot of the blame for congestion and pollution has been pinned on the company car but it just isn't right,' said Thompson. 'We have conducted some in-depth research to establish the facts and it paints a very different picture to the one put forward by the opponents of the car.'

SMMT senior economist Robert Baker said that since the last overhaul, the system of company car taxation offered a fair, stable and durable regime.