A round-up of parliamentary business during the week beginning 3 March:
The National Audit Office has published a report on the help to buy equity loan scheme. Commenting on the report the head of the NAO Amyas Morse said, ““The Help to Buy equity loan scheme is improving access to mortgage finance and for the most part is running smoothly. But the scheme’s costs, which come in large part from tying up £3.7 billion long-term in the housing market, will be substantial.If the Help to Buy equity loan scheme is to protect public value, the Department and the Agency need to quantify the scheme’s impact on construction and homebuyers, and manage as far as possible the risks to taxpayers’ money which is now exposed to the housing market.”
The chair of the Commons public accounts committee Margaret Hodge expressed her “shock” that the DCLG is investing up to £3.7 billion without a clear understand of how Help to buy will impact the property market. This issue will be raised when the department appear before the committee on 2 April.
During yet another debate on flooding, the minister Dan Rogerson was asked if he would confirm speculation that the prime minister had asked for band H and other exclusions be brought into a review of the Flood Re insurance scheme. Unfortunately, Mr Rogerson did not address this question in his response to the debate.
The CLG committee’s report on private rented sector and subsequent government response was the subject of a debate introduced by the committee chair Clive Betts. Mr Betts saw the recent growth in the sector as something that was likely to continue in the longer term. He suggested that Britain should emulate the German model, where there is more of an equilibrium between supply and demand. Housing minister Kris Hopkins recognised that there are challenges that the government needs to address. And he highlighted that government wanted to introduce a redress scheme, a tenants charter and a model tenancy, as well as crack down on rogue landlords.
The Consumer Rights Bill committee discussed clauses within the Bill relating to terms which must be regarded as unfair. In particular, amendments were tabled by the Opposition which would prevent mortgage lenders altering the interest rate within a contracted period without a valid reason, or where the borrower cannot get out of the contract without being disadvantaged. These amendments are in specific response to the Bank of Ireland decision last year to increase the rate on its existing tracker mortgages. Responding BIS minister Jenny Willott said, “the government are determined that lenders should treat borrowers fairly. That is a cast-iron position…However, as I am sure we all appreciate, decisions concerning the pricing and availability of mortgages, including the level of interest charged, remain commercial decisions for lenders. As long as lenders meet the rules set out by the FCA, the government doe not seek to intervene in those decisions.” The relevant amendments were subsequently withdrawn.
During a session of the Commons Deregulation Bill committee, MPs discussed a probing amendment on the qualifying period for the right to buy scheme.
In its report on green finance, the Commons environmental audit committee concluded that the government need to do more to accelerate the progress of increasing the flow of green finance and monitor its impact. The committee noted that responsibility is divided between different government departments, and suggested that working to a single strategy would create greater certainty and more favourable outlook for investors.
The House of Commons Library has published an informative briefing paper on the mortgage market review for members of Parliament. The paper included many references to the CML and its views during the course of the MMR, and includes our most recent News & Views article (pretty much in full) highlighting the practical implications for consumers, once the new rules are implemented in April.
And finally, we found out this week that the State opening of Parliament and Queen’s speech will take place on 3 June.
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