The government has said it will make £6.5m available to prevent redundancies at Rover this week.

Trade and industry secretary Patricia Hewitt announced the move on Sunday evening after coming under fire from opposition parties for her handling of the car firm's crisis following the collapse of talks with a Chinese company.

In a statement issued with union leaders Tony Woodley of the Transport and General Workers' Union and Derek Simpson of Amicus, Hewitt said the loan would be used to pay wages and expenses for the coming week.

The move means no mass redundancies will be announced on Monday - the day that Labour launches the economic chapter of its election manifesto.

"The government has been in discussion with trade unions that represent workers at MG Rover and the administrators throughout the weekend," said the statement.

"The government has agreed to provide the necessary funds to the administrators in order to avoid the issuing of redundancy notices at MG Rover while efforts are made to keep the business together.

"The government has agreed to assist and work with the administrator and with the unions who will be developing, with all reasonable speed, a realistic business proposition for SAIC [Shanghai Automotive Industry Corporation] and other possible purchasers to consider.

"We will monitor the situation closely and review the adequacy of funds available while there is a realistic prospect of re-engagement with SAIC.

"The government and unions said on Friday that we would do everything possible to sustain jobs and the future of manufacturing at Longbridge."

Criticism

Tory leader Michael Howard and Liberal Democrat chief Charles Kennedy both used media interviews on Sunday to say ministers had been too slow to help stop the last British car manufacturer going into administration.

Tony Blair and Gordon Brown both visited Rover's threatened Longbridge plant in Birmingham on Friday and pledged to "do everything in our power" to save jobs, help suppliers and salvage as much of the company as possible.

But Howard told GMTV Labour that they would have been aware of the situation for at least a year but had "got involved at far too late a stage".

"They seem to have been very slow and very late into the business of seeing what they could do to help," he said.

"I would do everything I could to help Rover survive. It's a hugely important part of our economy, not only of the economy of the West Midlands but of the country as a whole."

Review

Kennedy told the BBC's Breakfast with Frost programme that the government had waited for the "59th minute of the 11th hour" before stepping in.

That was a reference to the prime minister's last ditch phone call to the Chinese premier in a bid to rescue Rover's deal with the Shanghai Automotive Industry Corporation.

With the West Midlands a crucial electoral battleground, the chancellor announced on Saturday that he had ordered a review into the collapse of the company, after unions complained that the Phoenix consortium, which bought Rover from BMW, had pocketed multi-million pound profits and pension entitlements.

"There will obviously be inquiries into what has happened in Rover since the deal with BMW," Brown said on Saturday.

"But at the moment we have to look at what we can do to help the existing jobs, the existing manufacturing work, and the existing skills."

"We have already made some money available to help the supply companies and we will announce more in the next few days if it becomes necessary," he added.