- Mark Field, MP for the Cities of London & Westminster writes in the Daily Telegraph business section that the interest rate has provided UK business and individuals alike with breathing space. Nevertheless, the real question that should be foremost in the minds of policymakers after five straight years of emergency monetary stimulus, is at what cost to the nation’s long-term economic interests? Field feels the young and middle-class savers who are being significantly impoverished by Treasury policies. He says today’s young people grapple with sky-high rents and house prices, a less secure employment market and increasing personal debt. But, he says, ultra-low interest rates carry a cost – and it’s starting to rack up.
Recruitment & Employment
- Writing in today’s Daily Mail, Work and Pensions Secretary Iain Duncan Smith and Home Secretary Theresa May announce a crackdown on jobless immigrants seeking to access housing benefit. In the Mail’s leaders it backs IDS to the hilt: “Any doubts that Iain Duncan Smith’s crusade against welfare dependency is having the desired effect should be dispelled by an extraordinary set of figures published today. They show that in the last five years of the Labour government the number of British people in work fell by 413,000, while the number of migrants employed soared by 736,000. Yet since the 2010 election that depressing trend has been completely reversed, with 538,000 Britons finding new jobs compared with 247,000 foreigners.” In an interview with The Independent, shadow Work and Pensions Secretary Rachel Reeves has said that a Labour government would deny people unemployment benefit if they are unable to demonstrate that they have the basic skills needed to find work after six weeks on the dole. The Mirror’s leader piece comes out strongly against Reeves’ plans – “Make Jobs, not exams’ is the headline.
- In The Times, Deidre Hipwell reports that criticism of the Government’s Help to Buy initiative from a City financiers who has warned that London’s housing market is overheating, as research shows asking prices are rising by record amounts. Nigel Wilson, the chief executive of Legal & General said house prices in London and the South East had reached “absurd” levels and would soon only be affordable to the wealthy. He said young people were being encouraged to buy homes in “over- leveraged” situations and warned that the Government should stop stoking demand through its Help to Buy mortgage guarantee scheme.
- The Independent reports a fourth capital raise at Metro Bank has brought in £387.5m to aid growth, taking the total equity raised to £641m. Founder and Chairman Vernon W Hill said: ‘The revolution in British banking continues, with strong support from existing and new investors.’ Elsewhere in the sector, Treasury officials are believed to be considering a second sale of Lloyds shares as early as mid-February, following publication of the bank’s annual results on February 13 – that story runs in the Daily Mail.