I BOUGHT a house in 1992. Bad move. Long story. The best fixed-rate deal I could get was 9.9 per cent for five years. I remember the figures well because a month later, despite the then prime minister’s promise that the UK would never leave the European Exchange Rate Mechanism (ERM), the UK left the European Exchange Rate Mechanism (ERM).
So while everyone else’s mortgage interest rates were falling, mine stayed the same. That’s what happens when you trust the word of a Tory prime minister, I guess, so it served me right.
Now, I can see the comments already: “John Smith and the Labour Party supported Major’s ERM policy at the time…”. Yes they did. And they were wrong. But it was Major’s policy and Major’s responsibility. And Black Wednesday was his, his chancellor’s and his chancellor’s special advisor’s legacy.
The Bank of England base rate today is five per cent. Mortgage rates paid by home owners today are far, far lower than anything experienced during the Tories’ wasted years. Times are very difficult for those hoping to move house (and let’s face it: most of the criticism of yesterday’s stamp duty announcement is based on the fact that it was announced by a Labour government). But we would be kidding ourselves if we claimed that things wouldn’t be an awful lot tougher if we were experiencing the kind of interest rates the Tories inflicted on us.