Is Balls heading for a “Portillo moment”?

Tory opponent releases attack ad comparing leading Brown ally to Michael Portillo in 1997.

Here's an attack advert that Ed Balls's Conservative opponent has released, suggesting that the Schools Secretary could suffer the same fate as Michael Portillo did in 1997.

It's refreshing to see the comparison made correctly for once. The term "Portillo moment" is too often used merely to describe a well-known MP losing his or her (often marginal) seat. In fact, it should only apply to a significant political figure (Portillo was defence secretary) losing a safe seat (he had a majority of 15,563).

As such, Jacqui Smith's defeat in Redditch, where she has a notional majority of just 1,948, would not be a Portillo moment. But Balls's defeat in the new constituency of Morley and Outwood, where he has a notional majority of 9,784, would be just that.

So, what are the chances? The Tories dismiss talk of a "decapitation" strategy, but they are aggressively targeting the seat and campaigners have apparently been taken aback by the local hostility towards Balls.

The Schools Secretary also faces a challenge from a popular BNP councillor, Chris Beverley, and has been accused of pandering to anti-immigrant sentiment in response.

It seems all the ingredients are in place for an upset. And there is no doubt that the defeat of Balls, described by one cabinet minister as "the chief stormtrooper of the Brownite shock-troops", would be welcomed by the Tories like no other.

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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.