Discount all the speculation about the Budget, on Wednesday April 22, Chancellor Alistair Darling will stand up in the Commons and with a confident smile announce a range of measures to put the mortgage and housing markets to right.
He’ll say: “Forget about the £5,000 electric car giveaway and all that rubbish.
“Let’s face it, we don’t have enough power stations to generate the electricity we currently need, so how the hell can we charge up six or 10 million motors and keep the rest of the country running at the same time – especially in winter. No the idea is absolute bollacks.
“And as for the notion that you’ll be getting £2,000 off your next Range Rover if you scrap your old environment polluting banger, forget it. The only UK based firm that actually designs and manufactures cars rather than just assemble them is Indian-owned (Gordon thought that was a smart move) and its products are about as green as a World War 11 soviet tractor.
“No comrades, I mean honourable members, all our difficulties started with the credit crisis and supply side issues in the mortgage market so this time round I’m going right to the roots of the problem and I’m going to address the issues I’ve been ignoring for almost two years.
“Of course we won’t be giving away £2,000 or £5,000 to first-time buyers to help them with the deposit on home – that would be tantamount to admitting that homeownership is as important as car ownership.
“Nor will we be copying the Tory idea of giving away up to £6,500 to homeowners for the installation of energy saving technology because if I’m honest, having failed to deliver on our promise of three million new homes by 2020 what we need now is more homes, not millions of more energy efficient terraces in Notting Hill Gate where, coincidentally, my right honourable friend David Cameron happens to live.
“No it is my pleasure to announce a two fold strategy – first measures to incentives consumers back into the housing market and these will be implemented along with structural measures within the financial services industry to get institutions lending again.
“So out go Margaret Beckett’s HIPs – not before time some will say and on that score I’m happy to remind them that they were Yvette Cooper’s before Margaret’s, so they’ve been around along time without achieving very much.
“And out goes Stamp Duty too – that dreadful tax on homeownership in the South East. Well, we’re not scrapping it exactly, thought if we did it wouldn’t make much difference to our income flow at the moment given the state of the housing market. Instead we’re going to taper the way the duty is applied with an initial exemption of £175,000 also being discounted from higher priced properties to make the system equitable to all.
“Then, to address the mortgage supply side problems I have been listening to the views of the Council of Mortgage Lenders and taken cogniscence of individual mortgage experts such as Tony Ward of Home Funding Limited.
“Thus with immediate effect the government will be providing a guarantee for mortgage lending at loan to value ratios above 75% and up to 95%. This will enable banks and building societies to lend in this sector which has effectively been neglected since the demise of specialist lending and will help first-time buyers and key workers to obtain the housing finance they so desperately need.
“And finally, because retail funding can never meet the needs of a healthy mortgage market, this government is going to address the problems of the secondary markets and will be announcing measure to get the covered bond and securitisation markets up and running again.”
But if all this sounds too good to be true, then it is fair bet that it will be.