Five of the Best

The top five comment pieces from today's papers

The Times's David Aaronovitch says that the political class now refuses to put the positive case for immigration:

It is utterly false to say that we haven't talked about immigration. Many of our newspapers do very little but talk about it. They don't "debate" it because their operating assumption, like Mr Field's, is that it is bad; it overwhelms us; floods us; swamps us; it swarms in Sangatte, until it is closed, then infests "the Jungle".

No other point of view is put, just as Mr Straw failed to put it on Thursday, as he dangled between denial and defence.

The Independent's Steve Richards argues that George Osborne was wrong to claim that capping bank bonuses would make more loans available:

There is no evidence to suggest that if banks had a bit more spare cash in the form of shares they would make more loans available. Most banks are not strapped for cash at the moment, but are still reluctant to lend. It is one of the new perversities in banking. There is no correlation between the amount of cash available and their willingness to lend.

The Financial Times's Gideon Rachman says that, as there is no democratic mandate for the post, the EU is not ready for a high-profile president:

Blair would be presented as a real "president of Europe" -- able to speak on equal terms with Barack Obama of the US or Hu Jintao of China.

But if Mr Blair turned up in Beijing claiming to be president of Europe, the only thing that he would have in common with Hu Jintao is that they would both lack a democratic mandate. Ordinary Europeans would be justified in asking by what right the unelected Mr Blair speaks for them. The former prime minister remains a deeply controversial figure in much of Europe because of his support for the Iraq war.

In the New York Times, Roger Cohen discusses his meeting with David Miliband and says that Britain's resolve in Afghanistan appears to be greater than that of the US:

These were the convictions behind Brown's decision earlier this month to send 500 more British troops to Afghanistan, bringing the contingent to 9,500 -- a decision the prime minister expected to be "consistent with what the Americans will decide."

The reinforcement was about one quarter of what British generals had requested. In the US case, Gen Stanley McChrystal has asked for about 40,000 more troops. Doing the math on a "consistent" basis suggests a substantial American reinforcement short of McChrystal's request will eventually be announced by the White House.

The Guardian's leader defends baboons from the rifle of A A Gill:

A few million years ago baboons and human beings were more closely related than now. At some point the species diverged, with one line evolving into hominids and, ultimately, restaurant critics. The other line has remained in Africa, living in simple but rather admirable societies where intelligence and advanced social skills are highly valued. Respect to the baboon.

 

George Eaton is political editor of the New Statesman.

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I was wrong about Help to Buy - but I'm still glad it's gone

As a mortgage journalist in 2013, I was deeply sceptical of the guarantee scheme. 

If you just read the headlines about Help to Buy, you could be under the impression that Theresa May has just axed an important scheme for first-time buyers. If you're on the left, you might conclude that she is on a mission to make life worse for ordinary working people. If you just enjoy blue-on-blue action, it's a swipe at the Chancellor she sacked, George Osborne.

Except it's none of those things. Help to Buy mortgage guarantee scheme is a policy that actually worked pretty well - despite the concerns of financial journalists including me - and has served its purpose.

When Osborne first announced Help to Buy in 2013, it was controversial. Mortgage journalists, such as I was at the time, were still mopping up news from the financial crisis. We were still writing up reports about the toxic loan books that had brought the banks crashing down. The idea of the Government promising to bail out mortgage borrowers seemed the height of recklessness.

But the Government always intended Help to Buy mortgage guarantee to act as a stimulus, not a long-term solution. From the beginning, it had an end date - 31 December 2016. The idea was to encourage big banks to start lending again.

So far, the record of Help to Buy has been pretty good. A first-time buyer in 2013 with a 5 per cent deposit had 56 mortgage products to choose from - not much when you consider some of those products would have been ridiculously expensive or would come with many strings attached. By 2016, according to Moneyfacts, first-time buyers had 271 products to choose from, nearly a five-fold increase

Over the same period, financial regulators have introduced much tougher mortgage affordability rules. First-time buyers can be expected to be interrogated about their income, their little luxuries and how they would cope if interest rates rose (contrary to our expectations in 2013, the Bank of England base rate has actually fallen). 

A criticism that still rings true, however, is that the mortgage guarantee scheme only helps boost demand for properties, while doing nothing about the lack of housing supply. Unlike its sister scheme, the Help to Buy equity loan scheme, there is no incentive for property companies to build more homes. According to FullFact, there were just 112,000 homes being built in England and Wales in 2010. By 2015, that had increased, but only to a mere 149,000.

This lack of supply helps to prop up house prices - one of the factors making it so difficult to get on the housing ladder in the first place. In July, the average house price in England was £233,000. This means a first-time buyer with a 5 per cent deposit of £11,650 would still need to be earning nearly £50,000 to meet most mortgage affordability criteria. In other words, the Help to Buy mortgage guarantee is targeted squarely at the middle class.

The Government plans to maintain the Help to Buy equity loan scheme, which is restricted to new builds, and the Help to Buy ISA, which rewards savers at a time of low interest rates. As for Help to Buy mortgage guarantee, the scheme may be dead, but so long as high street banks are offering 95 per cent mortgages, its effects are still with us.