Why Labour isn't thanking Clegg for killing the boundary changes

Clegg was for the boundary changes before he was against them.

Given that he may have just handed the next election to Labour, you might ask why Nick Clegg isn't being hailed as a progressive hero by Ed Miliband's MPs this morning. The answer is that Labour still despises him for supporting the boundary changes in the first place. Clegg didn't merely accept the changes as a quid pro quo for the AV referendum (as the Deputy PM previously observed, they were never linked to House of Lords reform), he genuinely believed in them. In 2010, he told MPs:

There can be no justification for maintaining the current inequality between constituencies and voters across the country.

On another occasion, at Deputy Prime Minister’s Questions, Clegg declared:

It is one of the founding principles of any democracy that votes should be valued in the same way, wherever they are cast. Over the years, all sorts of anomalies have developed, such that different people’s votes are simply not worth the same in elections to this place. That surely cannot be right, and it is worth reminding those Opposition Members who object to the rationale that it was one of the founding tenets of the Chartists-one of the predecessor movements to the Labour party-that all votes should be of equal value.

As shadow justice secretary Sadiq Khan noted:

It was left to Labour to fight the arbitrary reduction in the number of MPs. Getting rid of 50 MPs hits Labour the most, and that’s why the Tory-led Government chose that figure. It was nothing to do with better politics, or about saving money – particularly as this Government has created an extra 117 unelected peers since May 2010.

The reason yesterday's events will do nothing to enhance Clegg's standing is that he chose to rebel over a matter of politics, rather than a matter of principle (such as the NHS reforms or welfare cuts). The Deputy Prime Minister's reputation as a turncoat and an opportunist is secure. Once again, he has united both the left and the right in loathing for him.

Deputy Prime Minister Nick Clegg and Labour Party leader Ed Miliband attend a ceremony at Buckingham Palace. Photograph: Getty Images

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.