Hands condemns Labour's mortgage bombshell

Greg Hands M.P. has warned homeowners in Chelsea and Fulham of the consequences for them should the Government stops dealing with the deficit. Labour’s plans to borrow yet more money could hike the average family’s mortgage bill by as much as £5,000 per year. The full detail of Labour's three point plan for £326 billion of more spending, more borrowing and more debt was revealed in a dossier published this week.

Ed Miliband and Ed Balls' spending rules require all their frontbenchers to get authorisation for spending commitments. Since they set out those rules, the effect of Labour's tax and spending plans would:

  • · Increase borrowing and debt by £326 billion over the next five years compared to the Government's plans.
  • · Only reduce the deficit by a quarter over four years – not halve it over four years as Ed Balls has promised.
  • · Put up the average family's mortgage interest bill by £5,000 per year, as the cost of borrowing increased.

Greg Hands M.P. said: “A one-point rise in market interest rates adds £1,000 to the average family’s mortgage bill. We are in the middle of a global debt crisis, but Labour’s answer is to borrow billions more and make families suffer. It’s economic lunacy.

“We have to live within our means. The Government is taking the tough but necessary decisions to get Britain back on its feet and keep the confidence of the markets. Labour’s profligacy would destroy that hard-won confidence, hit families and cost jobs.”

Chloe Smith, Economic Secretary to the Treasury, said: "This Government's credible plan to clear up Labour's mess and live within its means has ensured Britain is a safe haven in the global debt storm. But Labour would abandon this plan with billions and billions of more spending, more borrowing and more debt which would put us back in the firing line with Italy and Spain. This could risk putting up a family's mortgage interest bill by £5,000 per year.

"With the global debt crisis getting worse every day, the Government's plan to deal with our debts is even more important than ever, and Labour's plan for more spending, more borrowing and more debt is even less credible. It shows that Ed Miliband and Ed Balls have learnt nothing from when they were in government and why Labour must never be trusted with our economy ever again."

Click here to download the dossier.