Jenson Button a fan of the budget cap plan for Formula One

Jenson Button today backed the introduction of a £40million budget cap from 2010 which he believes will make Formula One more competitive.

The new regulation was part of a raft of proposals to shake up the sport announced by the governing body, the FIA, yesterday.

World championship leader Button said: "For the manufacturers and the bigger teams I'm sure they don't want that, but for teams like Brawn we need that for the future.

"It's the way F1 has to go in the times that we are experiencing."

Racing is dominated by manufacturers who are suffering in the global downturn thanks to a slump in car sales, while Button's former team, Honda, pulled out of the sport last year.

"For the teams that are not manufacturers this is what we need," Button told BBC online.

Teams are free to choose whether to be governed by the cap but those that opt out face certain restrictions. Some teams are spending £160m each year and the proposed introduction of the budget cap has raised fears that F1 will become a two-tier sport.

The FIA is to allow three new teams to enter from next year and those that join and work within the cap will get money from the commercial rights holder, a proposal that was welcomed by Aston Martin and Prodrive chairman David Richards.

"We remain encouraged by the new rules which have the potential for a team to be commercially viable and competitive on a far more realistic budget," said Richards, who has expressed an interest in entering F1 next year.