It is just as well that the Government has a well-trailed mortgage rescue plan to announce this week. Because if it didn't have something up its sleeve after today's dismal figures from the Bank of England showing that mortgage approvals for new purchases fell to a new low in July, events could have taken a distinctly uncomfortable turn. (The atmosphere in and around numbers 10 and 11 Downing street is already fraught after Alistair Darling spilled the beans on the economy at the weekend.)

But the problem now facing the government is that its plan must work. Sir James Crosby is not due to report his final findings on his nearly year-long review of the mortgage market until the pre-budget report, which will probably happen sometime in October or November, so the government is flying solo. The problem with this is that the only plan the Government has so far mooted - a stamp duty holiday for first-time buyers, has itself helped stall the market as Mr Darling and Mr Brown failed to comfirm whether or not it would happen. Unsurprisingly, some first-time buyers, who face an average bill of around £1,400 in stamp duty, are holding off buying a new home until they find out whether they could escape paying this charge upfront. After all, wouldn't you rather fit a new kitchen than fill the Government coffers?

This week's announcement must make it clear if the holiday will happen, as well as take some other, immediate measures to help unblock the mortgage market. Announcing more reviews, consultations or debates simply will not do.

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