We will have all felt the effect of rising prices each time we visit the supermarket. The UK is not alone in facing these challenges, with other countries also experiencing a cost-of-living squeeze. Many of the reasons driving this are the same: increasing costs of energy, shortages of certain goods and materials, and the consequences of the pandemic.
Halving inflation by the end of the year and growing the economy are two of the Government’s five pledges. Inflation not only erodes incomes and diminishes savings, it impedes business investment, stifles consumer confidence, and leads to higher debt repayments. We cannot achieve the kind of economic growth we need until inflation comes down. So, it is right that the Government makes relentlessly tackling inflation our priority.
Interest rates remain our primary tool for achieving this. Last week, the Bank of England, who sets interest rates independently of Government, decided to raise the basic rate of interest by half a percentage point to 5%, the highest level in 15 years. This has caused understandable concern for many people already facing financial pressures, particularly those with variable rate mortgages and those reaching the end of fixed term deals.
Offering direct Government financial assistance to mortgage holders, which would see large amounts of additional cash injected into the economy, would make inflation worse, prolonging the pain of rising prices. This does not mean that the Government is remaining idle as households face increasing repayments. Following a meeting convened by the Chancellor with our leading banks, principal mortgage lenders, and the market regulator, the Financial Conduct Authority, three important measures were agreed to help protect those facing mortgage difficulties.
Firstly, anybody who is feeling under pressure will be able to freely discuss their situation with their bank or mortgage lender, without any impact on their credit score. Secondly, families concerned about increased payments can now temporarily switch to an interest-only mortgage or extend the term of their mortgage. If they then wish to revert to their original mortgage deal within six months, they will be able to do so without any questions being asked and without their credit score being affected. Finally, for those at high risk of losing their homes, the banks and mortgage lenders agreed to a minimum 12-month period before repossession without consent.
These changes will provide homeowners facing mortgage-related problems with more information, options, and flexibility during what may be a challenging financial period.
In my column this week, I also want to touch on Refugee Week which ran from 19 to 25 June. The theme was ‘compassion’ and events took place across the country celebrating the contribution, resilience and creativity of people seeking refugee or sanctuary in the UK. Locally, the De La Warr Pavilion hosted a series of events throughout the week. I was invited to the Bexhill Ukraine Hub event which took place at the Pavilion last Thursday. Very sadly, I could not go due to Ministerial work in Birmingham, but members of my constituency team were able to attend and catch up with some of the Ukrainian families whose visas we helped to expedite last year.
Whilst Government policy is to stop illegal channel crossings, in order to control our borders and stop vulnerable people drowning, we’re proud of our resettlement programme which supports genuine asylum seekers.
You may have seen a feature about the Ukrainian Hub event on BBC South East News earlier this week (Tuesday). If so, or you attended in person, you will know that events like this remind us all too clearly of the tragedy of war and the daily challenges of being displaced from your home. But, they also demonstrate how much we have in common, regardless of whatever part of the world we come from, when we share songs, dance, music, art food and drink. These things connect us all and help us to celebrate life, love, loss and resilience in the face of adversity.
Families across the Bexhill and Battle constituency opened their homes and hearts to those seeking refuge from the Ukrainian war and others have become involved in supporting refugees from all over the world. My thanks go to everyone at the Bexhill Ukraine Hub and the De La Warr Pavilion who were involved in last week’s events marking Refugee Week.
If you are interested in becoming a host family for Ukrainian guests who may need to move on from their original host family, then East Sussex County Council can provide advice and information on how to do so. If you would like to help support a newly arrived person seeking refuge then the local charity, the Refugee Buddy Project would be pleased to hear from you www.therefugeebuddyproject.org
