Mr Pat McFadden (Wolverhampton South East) (Lab) (Urgent Question):
To ask the Chancellor of the Exchequer what assessment he has made
of developments in the mortgage market in recent days. The Economic
Secretary to the Treasury (Andrew Griffith) The Government
recognise the anxiety that people feel about mortgages, and are
using the tools at their disposal to limit the rise in rates. We
are not an outlier in this regard: as Opposition Members will know,
central...Request free trial
Mr (Wolverhampton South East) (Lab)
(Urgent Question): To ask the Chancellor of the Exchequer what
assessment he has made of developments in the mortgage market in
recent days.
The Economic Secretary to the Treasury ()
The Government recognise the anxiety that people feel about
mortgages, and are using the tools at their disposal to limit the
rise in rates. We are not an outlier in this regard: as
Opposition Members will know, central banks around the world are
raising interest rates to combat high inflation driven by the
pandemic and Putin's war.
Given that inflation is the No. 1 enemy, we are focused on
delivering the Prime Minister’s pledge to halve it this year.
Nevertheless, I know that mortgage rates and the availability of
mortgages are a concern right now. Mortgage arrears and
repossessions remain below pre-pandemic levels, but if a borrower
falls into financial difficulty, guidance from the Financial
Conduct Authority requires firms to offer tailored support and to
deal with customers fairly. The Government also offer loans to
help eligible homeowners to cover the interest on their mortgages
through the support for mortgage interest scheme from the
Department for Work and Pensions, and make it clear that
repossession must be a last resort for lenders through the
pre-action protocol.
As long as economic challenges exist, we will continue to stand
by families. To date, Government support to help households with
rising bills in 2022-23 and 2023-24 totals £94 billion. That is
equivalent to an average of £3,300 per household, as well as a
record 9.7% increase in the national living wage, which I am sure
that the Opposition support. While we are taking action to halve
inflation and help families, the Opposition would make it all
worse. The Institute for Fiscal Studies has been clear that
Labour’s £28 billion a year borrowing plan would risk even higher
interest rates and higher inflation, and even the shadow
Chancellor has admitted that its position is reckless. This is a
Government on the side of the British people and that is why, as
we shelter people from rising prices, our task remains getting
inflation down and getting the economy growing and debt
falling.
Mr McFadden
The UK’s homeowners are under increasing financial stress, with
two-year fixed rates at 5.86%—up by over 0.5% in just a
month—products being withdrawn, and the Resolution Foundation
saying that the average mortgage holder is facing an increase in
payments of £2,300 this year. This is not just about homeowners;
it is about renters too, because the landlords they rent from are
also facing increased borrowing costs and that in turn is forcing
up rents.
All this pressure was multiplied by the irresponsible decision of
the Conservative Government last year to use the country for a
giant economic experiment that put booster rockets under mortgage
rates. While they enacted their teenage right-wing pamphlet
fantasies, using the country like lab rats, homeowners and
renters were left to pay the price. Since then, because inflation
in the UK has been higher for longer than in many similar
economies, the expectation is that interest rates will be higher
for longer too, and that is what is driving up mortgage rates and
piling on the pressure.
While the Ministers responsible rack up speaking fees around the
world, the British public are still paying the price for the
economic irresponsibility and recklessness of the Conservative
party. Will the Economic Secretary now apologise for the
Conservative mini-Budget last September and the lasting effect it
has had on homeowners and renters around the country? Will the
Government take responsibility for the decisions that they made
and the consequences that followed, or is it, as they always
claim, someone else’s fault? Now, instead of trying to help
hard-pressed homeowners, the Conservatives are fighting like rats
in a sack over an honours list and a disgraced Prime Minister. It
is clear that they cannot focus on the problems of the country;
the only way to do that is to change the Government and let them
fight it out in opposition.
We enjoy, as ever, the hon. Member’s rhetoric, but he did not
address what his plan would be. He also did not acknowledge that
this has an international factor. Perhaps he or one of his
colleagues would like to explain why we have seen similar
interest rate increases in the USA, where the 30-year rate—the
market is somewhat different there—has increased from 4% at the
start of 2022 to more than 6% today.
Mr Speaker
In fairness, the right hon. Member for Wolverhampton South East
(Mr McFadden) is right honourable. But there we are. I call the
Chair of the Select Committee.
(West Worcestershire)
(Con)
The Government have given the Bank of England the task of
targeting inflation at 2%, and our Committee has regularly held
the Bank of England Governor’s feet to the fire over its
performance on that inflation target. Mortgage rates have been
increasing because inflation has been higher for longer than
expected. In fact, the Governor said in his evidence to our
Committee last November that from now on, our grumpy constituents
who are having to pay higher mortgage rates should complain to
him rather than to the Government. Will the Economic Secretary
endorse the Treasury Committee’s campaign to ask the banks why,
instead of just raising mortgage rates on the day the Bank of
England raises rates, they do not also increase the savings rates
that are paid to our constituents?
The independent Governor of the Bank of England is, of course,
right. Today we have seen strong print on wage growth, in part
due to the 9.7% increase in the national living wage, on which I
hope Members will join me in congratulating the Government. My
hon. Friend is, as ever, right to highlight the impact on savers.
It is important to me and to this Government that savers get a
fair deal, which is one of the reasons why National Savings and
Investments continues to offer savers an attractive range of
products in the market.
Mr Speaker
I call the SNP spokesperson.
(Dundee East) (SNP)
Millions of households are now struggling as their fixed-rate
mortgages end and they are moved to much higher variable rates.
We also know that only a third of the households that are
expected to move from cheap fixed-rate deals have done so, so
there is a great deal of pain to go, with 116,000 households a
month coming off fixed-rate deals.
Some in the City are suggesting that what we are seeing is a
complete reset of the mortgage market, which would imply that
there should be a complete reset of the Government’s approach.
Given that changes to mortgage rates are driven by changes to the
base rate, and that the base rate is the central bank’s primary
tool to meet the 2% inflation target handed to it by the
Government, what discussions have the Government had with the
Governor of the central bank about the effectiveness, or the
appropriateness, of an inflation target being the primary target
that the central bank works towards?
At his spring statement, the Chancellor was very clear about the
Bank of England’s continued remit, beyond which it remains
operationally independent. It has been a long-standing feature of
this House that Treasury Ministers do not tell the Bank of
England how to run monetary policy. Three of the Prime Minister’s
five priorities are getting the economy growing, reducing debt
and halving inflation.
Mr Speaker
I congratulate the now Sir .
Sir (Middlesbrough South and East
Cleveland) (Con)
That is very kind, Mr Speaker.
I pay tribute to the right hon. Member for Dundee East () for the previous question,
which was extremely interesting and perceptive. Of course, it
should escape nobody’s attention that, today, gilt yields are
higher than they were when my right hon. Friend the Member for
South West Norfolk () was forced from office in
the autumn. I agree entirely with the Minister that it is
important to avoid the inflaming of inflation that the Opposition
would do, but does he also agree that ultra-low interest rates
cannot be seen as the sole benchmark of economic success and that
we ought to aspire to higher trend growth as much as low interest
rates?
I add my congratulations to my right hon. Friend, who is right
that a stable fiscal environment and the lowest possible interest
rates are two ingredients and prerequisites for success, but so,
too, is a supply-side economy that works to support growth and
having the most competitive fiscal environment, which is one
reason why the Chancellor has asked the Chief Secretary to the
Treasury to look at public sector productivity, with a view to
achieving that.
Dame (Wallasey) (Lab)
To hear the Minister talk about a stable economic environment
after the disaster of the mini-Budget and the catastrophe it
caused in the bond markets takes some cheek. I commend his cheek,
because it is unbelievably cheeky.
Does the Minister acknowledge that households have shelled out
over £1 billion in extra mortgage payments since the Government’s
disastrous mini-Budget? Does he also realise it is estimated
that, in the next two years, £9 billion will have to be shelled
out by those with mortgages because of his party’s economic
mismanagement? Is he proud of that record?
It may cause the hon. Lady some distress, but I am enormously
proud of the £94 billion the Government have provided to support
households in these difficult times. I am proud, too, of the
Government’s response to the covid pandemic and to Ukraine—would
it ill behove any Opposition seeking office to mention those
things a little more when talking about the economy? Above all
else, I am enormously proud that when any Conservative Government
leave office they do not leave notes behind saying, “Dear Chief
Secretary, I am afraid to tell you that there is no money
left.”
(New Forest West) (Con)
Inevitably, the level of Government borrowing itself is a
determinant of interest rates, isn’t it?
My right hon. Friend—I congratulate him as well—is right to say
that one factor is the level of Government borrowing. This
Government have had to borrow unprecedented amounts due to the
covid pandemic and the war in Ukraine, and to provide households
with that support of about £3,300 over this year and last. That
is one reason why one of our key priorities is to reduce the
level of debt.
(Bethnal Green and Bow)
(Lab)
The Minister likes to point out, as he has done again, that this
is about international factors and covid—there are lots of other
reasons given. However, the Government fail to mention the
mini-Budget fiasco caused by the previous Chancellor and the
former Prime Minister, with its direct consequence of mortgage
increases, with millions of people suffering. Why does the
Economic Secretary not come clean on this, as the former Prime
Minister and former Chancellor, who presided over that chaos,
have done? It is not time that he stopped whitewashing and faced
the reality of what he and his Government are responsible for,
which is causing misery to people’s lives?
The hon. Lady needs to look at the facts and the numbers. Despite
moving in alignment with other international markets—and interest
rates have increased over time—interest rates even today for
mortgage holders are lower than those reached in October last
year. So we are dealing with a macroeconomic international trend,
which we are seeing across all western economies. We are moving
in alignment with them, but this Government will always
prioritise support for households, which is one reason why we
have come forward with such significant economic packages in the
past two years.
(Bracknell) (Con)
I would love to be able to pass on some good news to my
constituents about their households bills. We are seeing
wholesale energy costs fall but they are not being translated to
the consumer. So how long after inflation falls will we see
interest rates come down?
My hon. Friend is a diligent champion for his constituents in
Bracknell and I am sure it will not be too long before he has
good news to talk about on prices that consumers face. We have
seen the cost of fuel coming down and as we achieve the Prime
Minister’s objective of halving inflation this year, so some of
the cost of living pressures that his constituents face will
abate. In the meantime, he should know that this Government are
on the side of households and we have been willing to support
them to the tune of about £3,300 every year. I wish his
constituents all the best.
(Kingston upon Hull West and
Hessle) (Lab)
Interest rates are up and mortgage deals are being pulled left,
right and centre, yet the Minister has had to be dragged here to
answer this urgent question. Will the Government please refocus
on this mortgage crisis, rather than on the latest round of
Conservative infighting, and give the public the reassurance they
desperately need?
I can give the hon. Lady the reassurance that the wellbeing of
the nation’s mortgage holders, savers, pensioners and investors
is the whole of my focus, as it is of all of my colleagues on the
Treasury Bench. As Members on both side of the House will know,
it is a feature of the UK mortgage market that from time to time
mortgage deals are withdrawn from the market and repriced. As of
now, there are more than 5,000 mortgage offers from different
suppliers, at different tenures, in the market. It remains my
focus to ensure that those who seek to buy a first home or to
remortgage their home have the most competitive offers
available.
(Penistone and Stocksbridge)
(Con)
One of the biggest challenges facing our country is the inability
of young people to afford to buy a home because of inflated house
prices. Although recent interest rate rises have compounded the
problem, is not the real problem that interest rates were far too
low for far too long, turning savers away from saving and into
property investment instead, and thus pushing up the price of
property as an asset? Does my hon. Friend agree that this is not
an easy problem to solve, but that one possible answer would be
for local authorities to build homes that can be bought at a
reduced rate, not by investors, but by local young people?
I thank my hon. Friend who does a wonderful job of advocacy for
her constituents, including those who seek to buy their first
home. This Government, through a variety of measures to support
householders in general, have helped more than 800,000 people, of
all types, to purchase a property since 2010. That represents a
city of approximately the size of Liverpool, such is the scale of
the endeavours. It is of course important that we get the nation
building, and part of that is about providing the economic
stability whereby people are willing to make investments for the
longer term.
(Richmond Park) (LD)
The Government’s economic mismanagement has caused low growth,
soaring food bills and record mortgage costs. Millions of
hard-working people are being penalised for getting a foot on the
housing ladder, in places such as Mid Bedfordshire, the area with
the third highest share of mortgage holders in the country. The
Minister mentioned the support from the mortgage interest scheme.
[Interruption.] In this time of hard-pressed families, will his
Government commit to converting that from a loan to a grant?
I did not hear fully what the Member for Richmond Park aligned
with Mid Bedfordshire was saying, but I am sure that residents in
Mid Bedfordshire have welcomed the stability that we have brought
to the economy and the fact that we have supported householders
through the past two difficult years, making tough decisions and
supporting households to the tune of about £3,300. They will also
have welcomed the fact that we have the sort of responsible
stewardship of the economy that means that we are not a
Government who have historically left power with unemployment
higher than when we arrived, leaving notes saying, “There is no
money left.”
Mr (Old Bexley and Sidcup)
(Con)
My hon. Friend is correct to highlight that we are facing
international challenges and that monetary policy is the
responsibility of the independent Bank of England. However, does
he agree that Labour’s £90 billion-worth of unfunded spending
commitments would make inflation and the cost of borrowing even
worse?
I thank my hon. Friend the Member for wonderful Old Bexley and
Sidcup (Mr French) for that. I recall that last October
Opposition Members were never shy of citing the Institute for
Fiscal Studies, but they do so much less today, because the IFS
has said that Labour’s £28 billion borrowing plan would cause
both interest rates and inflation to rise. I do not see how that
would help the nation’s mortgage holders.
(Blaenau Gwent) (Lab)
The value of mortgage arrears has risen by a troubling 10% in the
past quarter, so what is the Minister’s assessment of the likely
level of arrears in the next quarter?
I talked about the focus on the level of mortgage arrears, which
are at an historic level. My Treasury colleagues and I are
tracking them extremely closely. We have talked to all the
lenders and the Chancellor has brought them all in to ensure that
they have responsible policies in place so that repossessions are
a last resort.
(Don Valley) (Con)
Does the Minister agree that although the Opposition like to
blame the Government for this situation, the real problem lies
with covid and the Bank of England? The Bank kept on putting
money into the economy when the world had stopped producing
everything, which meant that there was more money and fewer
goods, and so inflation was obviously going to rise. Does he also
agree that even though we are in this situation where the Bank is
trying to do what it is doing and the Government are doing
everything they can, continually putting up interest rates puts
people in a really difficult position? Does he believe that we
should see what the interest rate increases have done so far in
the economy before the Bank of England keeps putting them up
month on month?
My hon. Friend speaks wisely and regularly on behalf of his
constituents. I will not follow him quite so far as to comment on
what the Bank of England should do next.
Just in response to the previous question, Mr Speaker, the level
of arrears in residential mortgages, as reported by the FCA, was
0.8% compared with 3.3% back in 2009.
(Ceredigion) (PC)
The Resolution Foundation has estimated that around 1.6 million
households will see their fixed-rate deals come to a conclusion
before the first quarter of 2024 and, therefore, will obviously
feel the impact of increased rates. What is the Treasury’s
assessment of the impact that this hit to households’ disposable
incomes will have on the wider economy?
We all want interest rates to fall as rapidly as possible. The
Bank of England needs to conduct its monetary policy against the
target that the Chancellor has set. The Government need to do
everything we can to try to reduce the level of debt by
controlling our spending, even when that creates difficult
decisions for us to make. We will do that so that the day when
interest rates fall comes more quickly. In the meantime, this
Government are trying to shield households from the pressures of
the cost of living, which is why we have deployed that £94
billion this year and last.
(Harrogate and Knaresborough)
(Con)
Does my hon. Friend see any consistency in the Opposition’s
analysis that suggests that the primary cause for interest rate
rises is unfunded borrowing, while making significant unfunded
borrowing pledges themselves? Will he continue his focus on
fiscal discipline and ensure that Government support is targeted
at those who need it most in this period of astonishing
international instability?
My hon. Friend is absolutely right: the last thing that the
economy needs at the moment is any party coming forward with more
unfunded spending cuts. It is why the Institute for Fiscal
Studies has raised concerns about an increase in interest rates
and inflation if Labour were to come to power and spend an
additional £28 billion, which I believe even the shadow
Chancellor herself has confessed would be reckless.
(Lewisham East) (Lab)
When would the Minister say the Tory party gave up being the
party of home ownership? Was it when it crashed the economy last
autumn, or was it when it scrapped house building targets?
The hon. Lady is, I am afraid, completely incorrect. The
Conservative party is absolutely on the side of home ownership.
It is why we have always supported the right to buy, in the face
of opposition not just from the Labour party but from
Labour-controlled local councils. It is also why we continue to
have a wide range of schemes in the market to help first-time
buyers.
(Leicester West) (Lab)
Santander is the latest major bank to temporarily pull its
mortgage deals for new borrowers, just days after HSBC did the
same. The Minister shrugs his shoulders as if to say that there
is nothing to see here, but is it not the truth that this degree
of turbulence is not normal, that inflation is significantly
worse here than in Europe and the United States, and that
ordinary people across the country will look at his denials today
and wonder what planet he is living on?
I honestly think that contribution from the hon. Member is
unworthy. I would not go so far as to ask her to withdraw it, but
if she looks at my comments she will see that I absolutely
understand the anxiety that people have about their mortgages. It
is a very significant part of people’s household finances. That
is why we are using all the tools at our disposal: both providing
public spending to protect and shield households at this
difficult time, and making the tough decisions to get the economy
growing again and to keep debt under control, which is the action
that will result in interest rates falling sooner.
(Luton South) (Lab)
People from Luton have moved into Mid Bedfordshire to get on to
the housing ladder or to raise their families. [Interruption.] It
is true. Due to this Conservative Government’s economic failure,
they are now facing soaring mortgage repayments, and we are even
seeing banks withdrawing mortgage deals for new borrowers. How
can voters trust the Government and the Conservatives to address
the mortgage crisis when they are the ones who caused it?
I am deeply intrigued by the concept that the hon. Lady’s
constituents have hitherto been moving to the neighbouring
Conservative-held seat of Mid Bedfordshire. Perhaps they
recognise the better economic potential—the better opportunity to
bring down rates as a result of our making the tough choices.
Perhaps they welcome the sheer amount of support that we have
provided for homebuyers. I wish her constituents well and hope
that those who have moved to Mid Bedfordshire enjoy their next
Conservative Member of Parliament.
(Eltham) (Lab)
The Minister claims that the current economic climate is down to
the world economic situation, but in the next breath he claims
that if, at some unspecified date in the future, things get
better, that would be down to the Government. Over the recent
period, mortgage borrowers have contributed an extra £1 billion
in interest rates. Over the next couple of years, they are
predicted to contribute £9 billion. The previous Prime Minister
has apologised for her contribution to that, so why will he not
do the same?
In fairness, it is absolutely the case that these are largely
international factors. The job of the Government is to control
the variables within their control. The primary thing that they
can do is not to come forward with greater unfunded spending
promises as that would put more pressure on the public purse and
would lead to interest rates and inflation being higher for
longer. That is what is within our controllable domain and that
is what we are focused on. I am not worried about where the
credit accrues or otherwise; what I am worried about is trying to
reduce interest rates for ordinary people at the earliest
opportunity.
(Inverness, Nairn, Badenoch
and Strathspey) (SNP)
The Minister talks about Government support and bandies about
some big numbers, but does he understand that the effect of that
for people is like taking a watering can to the economic bin fire
that his Government set alight? Does the Minister have the
humility to apologise right now to my constituents who are
struggling? The mortgage rate rises might be the straw that
breaks their backs—some are already broken—following as they do
on the Government’s endeavours in terms of the mini-Budget and
Brexit, which have fuelled this economic crisis.
I thank the hon. Member for his question. It must have been quite
hard to get through all those points without once mentioning the
fact that this has an international dimension. There is a war on
European soil in Ukraine, and we have just come through an
unprecedented global pandemic. He simply tries to reduce this to
whatever is his party’s particular topic of the day. That is not
worthy of him when we are trying to have a proper economic
debate.
(Gower) (Lab)
The Minister claims to be shielding families. He evidently is not
going to say sorry. When everybody in this House is supporting
their constituents, we need to know what assessment the
Department has made of the number of people actually affected by
recent increases in mortgage rates.
I thank the hon. Lady for her question. Like others, the FCA has
talked about the number of people in any one year whose mortgages
are repriced. We do not know what the price of those will be. It
seems that around 1 million to 1.5 million people are affected,
so a significant number, as my hon. Friend the Member for
Bracknell () mentioned. There are
also many savers in society. Rather than looking at what is
happening, what we are doing to help is making those difficult
decisions. We are not unleashing unfunded, uncosted spending
plans on the public purse and we are trying to get through this
to help people get to a world where inflation is falling, the
cost of living pressures on them are reducing and we can get the
economy growing again, which will provide good employment
opportunities for her constituents.
(Belfast South) (SDLP)
I wrote to the Minister earlier this week about the continuing
problem of mortgage prisoners, following a comment from the
Treasury that it is open to proportionate solutions for those
frozen in that position after their mortgage lenders were sold
from 2008. Recent reports state that the Government made a profit
of £2.4 billion from selling on those mortgages. Will the
Minister work with me, and with advocates for the tens of
thousands of people trapped in those precarious financial
circumstances, to find those proportionate solutions?
The hon. Lady raises the plight of those who have been unable to
access even the mortgages at elevated levels that we have been
talking about here. I understand the problem; it is something I
have given significant time to with my officials and I have read
the recent work conducted by the London School of Economics. I
hope that, in that spirit, she will also recognise that it is a
complex issue and that within that overall collective there are
many different individual fact patterns. While I am open to
finding solutions, I hope she will recognise that it is not easy
and there is no one-size-fits-all answer.
(Hornsey and Wood Green)
(Lab)
The Minister says there are 1,100,000 people affected by the
mortgage market chaos inspired by the Truss-Kwarteng abracadabra
magic last autumn. How many renters are affected? There is a
renting crisis in my constituency and people simply cannot afford
an overnight 20% increase in their rent.
I do not have any figures for rental, but the rental market is
something we look at closely and we will keep an eye on what
happens to those buy-to-let renters. My right hon. Friend the
Secretary of State for Levelling Up, Housing and Communities has
brought a significant set of reforms before this House to help
renters. I come back to the point that, however popular or
unpopular it may be with the Opposition, the best way to manage
this situation is to be prudent with the nation’s finances, to
get the debt burden falling and to give the markets confidence so
that interest rates fall as quickly as possible. I ask all
colleagues to work with us on that. The last thing we should be
doing is putting out the Opposition’s £28 billion a year of
unfunded promises, which will spook the markets and lead to the
sorts of rates that none of us wishes to see.
(Slough) (Lab)
Shockingly, new data this morning reveals that the value of
mortgage arrears has risen by 10% on the quarter—the highest and
fastest increase in more than a decade. Many of my constituents
are struggling to pay their mortgages. Unfortunately, they are
paying the price for the Conservative Government’s economic
failures, because a typical household’s mortgage payments are now
three times greater than they were just two years ago. What
conversations and what meetings have the Minister and the
Chancellor had with lenders, and what action will they take to
provide forbearance for my constituents?
I should be grateful if the hon. Gentleman would write to me with
those statistics. The statistics I quoted earlier are that the
level of mortgage arrears reported by the Financial Conduct
Authority for the period up to the end of 2022 was 0.81%. That is
a record low in recent memory, significantly lower than before
the pandemic and much lower than it was in 2009. I am very happy
to engage with him about the level of mortgage arrears. I engage
with mortgage lenders all the time, as does the Chancellor, and
we want them to have the right degree of forbearance for families
who are struggling.
(Battersea) (Lab)
This Tory mortgage crisis is affecting my constituents. In
London, mortgage costs are set to increase by more than £1.8
billion, people face the financial strain of high interest rates
and incomes are not keeping up with those costs. When will the
Minister finally get real, understand the impact of the crisis
that his Government created and apologise to our constituents?
What reassurances can he give to my constituents who will be
facing remortgage costs?
I can give a number of assurances to the hon. Lady’s
constituents. I imagine that Battersea is a very cosmopolitan
place, so as people travel around the world they will understand
that western economies across the world are facing exactly the
same impact on the cost of living and on interest rates. She
talked about £1.8 billion as a very large number; indeed it is,
and we share the concern of those with mortgages. However, I put
it to her that £94 billion is also a very big number, and that is
the amount of household support that we are providing during this
cost of living crisis.
(Carmarthen East and
Dinefwr) (Ind)
Earlier this year we saw the collapse of Silicon Valley Bank and
Credit Suisse. What assessment has the Treasury undertaken of the
general resilience of UK financial institutions, especially in a
context where rising mortgage costs might lead to a rapid
increase in household repossessions?
My Treasury colleagues and I liaise closely with the Bank of
England and the Prudential Regulation Authority, whose job it is
to assure us of the soundness and resilience of banks. The
Governor has talked about how the UK financial system is safe,
secure and soundly capitalised, and that remains my belief.
(York Central)
(Lab/Co-op)
York is a low-wage economy, yet we have extortionate house
prices. Last year, housing costs went up by 23.1% in York—the
highest rise in the country. My constituents are already
mortgaged to the hilt and cannot afford more. What protections
will the Minister put in place if mortgage rates rise further, as
they are predicted to do? My constituents simply cannot afford
their mortgages and they cannot afford this Government.
If York is a low-wage economy, the hon. Lady’s constituents will
be benefiting enormously from the unprecedented 9.7% increase in
the national living wage. The measures we are
putting—[Interruption.] Perhaps she does not like the 9.7%
increase in the national living wage that this Government came
forward with. We are putting measures in place with lenders,
including forbearance, and working with the Department for Work
and Pensions on mortgage interest support and to ensure that
families have access to the support they need.
(Newcastle upon Tyne Central) (Lab)
The typical household’s mortgage payments have risen threefold in
the last two years, yet in the north-east the typical wage packet
is lower than when the Conservatives came to power 13 years ago.
The Minister refuses to take any responsibility for the economic
misery his Government are inflicting, despite having flagrantly
and blatantly crashed the economy less than a year ago. Will he
tell my constituents why they should carry on paying the price of
Conservatism?
Once again, we have a contribution from the hon. Lady that
completely ignores the fact of the global pandemic, the £400
billion of support we have provided and, although I believe she
is highly literate in these matters, the fact that interest rates
are rising across the western world.
(North Ayrshire and Arran)
(SNP)
In the first three months of this year, repossessions increased
by 27% on the same period last year, and the latest estimates
show that 2.5 million customers will need to renegotiate their
mortgages over the next two years, with their payments increasing
by £9 billion. Is the Minister really telling us that he is
satisfied and that he has no reservations about the way that his
Government have mismanaged the economy, with the consequent
economic turbulence and soaring interest rates that are literally
pricing people out of their homes?
This Government are focused—and this is what our constituents
want to hear—on halving inflation, growing the economy and
reducing the debt burden. From today forwards, that is the action
we can take that will see interest rates falling sooner, reduce
inflation and get us back to a position of economic growth. I am
sure the hon. Lady wants that for her constituents as much as I
do.
(Chesterfield) (Lab)
The Conservative party once prided itself on being the party of
homeowners. The fact that we long ago ran out of Conservatives
asking questions makes it clear that Tory MPs realise they have
nothing to say to those people. Does the Minister realise that my
constituents who are desperately worried about the cost of their
mortgages will not have heard a single word from him to suggest
that things are going to get better as a result of this
Government’s actions?
I can absolutely reassure the hon. Gentleman that the Government
are focused on his constituents, even if his colleagues find it
useful to ask the same question again and again. We are focused
on not making the sort of unfunded spending commitments—such as
the £28 billion that the right hon. Member for Leeds West () herself described as
“reckless”—that would really cause difficulties for mortgage
holders in Chesterfield and across the United Kingdom.
(Bermondsey and Old Southwark)
(Lab)
Given the jump in mortgage arrears, and to help everyone who is
struggling to pay the Tory surcharge on their mortgages since the
disastrous mini-Budget, is the Minister considering increasing
access to mortgage interest relief?
There are no plans to change that. Those are matters for fiscal
events and for the Chancellor.
(Putney) (Lab)
The Tory mortgage crisis is affecting my constituents in Putney,
including a group of young sharers I met this week whose landlord
has had his mortgage increased and has passed the costs down to
them. They have to leave their home and the area because they can
no longer afford to live in south-west London. The Minister has
blamed global factors again and again, but the cost of borrowing
is higher here in the UK than in other developed economies. Does
he agree that this is a Tory mortgage penalty—a Truss tax—and
that the Government are to blame for the 13 disastrous years of
housing policy that have brought us here?
I do not agree with the hon. Lady, however fine her rhetoric may
be. The reality is that, if we want the nation’s householders to
pay less for their mortgages, we need responsible Conservative
management of the economy. When it comes to her Putney
constituency, the best thing that she can do, if she is on the
side of those who wish to own their own home, is urge the Labour
Mayor to build more homes.
Hon. Members
He is!
Madam Deputy Speaker ( )
Order. [Interruption.] No; do not argue with me.
I am responding to—
Madam Deputy Speaker
No, you are not. That question is finished. There is a danger
that the House might not be able to hear the question from the
hon. Member for Strangford ().
(Strangford) (DUP)
There is no danger of that when you are in the Chair, Madam
Deputy Speaker.
I thank the Minister for his answers to some very difficult
questions. It has been said that 1.5 million households,
including some of my Strangford constituents, are set to come off
fixed mortgage deals this year and face a sharp rise in their
monthly repayments—up to 1.56 percentage points from Tuesday. Has
the Minister made an assessment of the impact on those who are
considering buying their first house in the next year or so, and
will he assure the House that discussions are taking place with
local banks on what we can do to support people through the
process of buying their first homes amid shocking price
increases?
Let me be clear: the Government understand—I understand—the
anxiety of those who have a mortgage, those who have invested in
their home and those who wish to do so. That is why we will do
everything we can—be it providing financial support to the tune
of £94 billion, or making good decisions about our stewardship of
the economy and not coming up with unfunded spending
commitments—to ensure that we get back, as quickly as possible,
to a world of falling interest rates and falling inflation, and
support those who wish to buy a home above their head.
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